Open market rent

Open market rent is the rent that a willing landlord would accept from a willing tenant for a property let on the open market at the date of assessment, assuming neither party is under unusual pressure and both are acting with reasonable knowledge of market conditions. The definition is established in the context of the Housing Act 1988 and applied by the First-tier Tribunal when determining whether a proposed Section 13 rent increase is lawful. Under the Renters' Rights Act 2025, which came into force on 1 May 2026, open market rent is the statutory ceiling for any rent increase on an assured periodic tenancy in England, a landlord may not propose an increase above it, and a tenant may challenge any increase they believe exceeds it.

Why open market rent matters under the Renters' Rights Act 2025

Before 1 May 2026, rent review clauses in tenancy agreements could be used to increase rent, and the Section 13 notice process was one of several available routes. Since 1 May 2026, Section 13 via Form 4A is the only lawful mechanism for increasing rent on an assured periodic tenancy without tenant agreement. Rent can only be increased once in any 12-month period, and the proposed new rent must not exceed the open market rent for the property.

A critical change introduced by the Renters' Rights Act 2025 affects the tribunal process: if a tenant challenges a Section 13 notice, the First-tier Tribunal (Property Chamber) can only set the rent at or below the figure proposed in the notice. It cannot set a rent higher than the landlord proposed, even if market evidence would support it. This asymmetry means that if a landlord underestimates open market rent and proposes a figure below true market value, they are locked into that lower figure for the following 12 months. Accurate market evidence before serving Form 4A is therefore more operationally important than at any previous point.

How open market rent is determined

Open market rent is not a formula, it is an assessment of what the property would actually let for on the open market at the relevant date, on a new tenancy with standard terms. The assessment disregards the personal circumstances of the current tenant, the landlord's costs, and any improvements the tenant has made to the property at their own expense.

In practice, the most credible evidence for open market rent comes from:

Comparable listings and achieved rents - properties of similar size, type, condition, and location that have been let recently. Asking prices alone are weaker evidence than achieved rents (the rent at which a property actually let, rather than the price at which it was advertised). Rightmove and Zoopla show asking prices; agents and property data services can supply achieved rents.

ONS private rental index - the Office for National Statistics Price Index of Private Rents tracks average rents by region and property type. It is useful context for tribunal purposes but does not substitute for property-specific comparables.

Condition of the subject property - the tribunal assesses open market rent in the property's actual condition at the date of the notice. A poorly maintained property would not achieve the same rent as an equivalent well-maintained one. Landlords should not propose a rent premised on a condition the property has not yet reached.

From working with self-managing landlords preparing Section 13 increases, the most common error is proposing a figure based on asking prices rather than achieved rents in the local area. If a tenant challenges at tribunal, asking prices carry less weight than evidence of what similar properties have actually let for in the preceding three to six months.

Evidencing open market rent for a Section 13 notice

A defensible Section 13 evidence pack should contain: at least three comparable properties of similar size, type, and location that have recently been let or are currently listed; the source of each comparable (Rightmove, Zoopla, or agent-confirmed achieved rent); a note on any material differences between the comparables and the subject property (size, condition, parking, garden, broadband) and how those differences affect the comparison; and the proposed new rent with a brief rationale.

Keep this evidence at the time of service. If a tenant makes a tribunal application, evidence assembled after the notice date carries less weight than contemporaneous market research. The rent increase calculator calculates the minimum notice date and new annual rent figure; gathering comparable evidence is a separate step that precedes serving the notice.

For guidance on setting rent from scratch when reletting, see the article on how to set the right rent. For the full rent review process including notice mechanics and tribunal timelines, see the rent review entry.

Frequently asked questions

Can a landlord increase rent above the open market rate?

No. Under the Renters' Rights Act 2025, a proposed Section 13 increase above open market rent can be challenged by the tenant at the First-tier Tribunal. If the tribunal finds the proposed rent exceeds market rate, it will set the rent at the market level, which may be lower than the figure proposed.

What happens if a tenant does not challenge a Section 13 notice?

If the tenant neither challenges the notice nor pays the new rent, the increase takes effect on the date stated in the notice. Paying the new rent even once is typically treated as acceptance. The landlord cannot serve another Section 13 notice for at least 12 months after the increase takes effect.

Does open market rent apply to the initial rent at the start of a tenancy?

Under the Renters' Rights Act 2025, a tenant can challenge the initial rent during the first six months of a new tenancy if they believe it exceeds the open market rent for the property. This is a new right introduced by the Act. The application is made using Form MR1 to the First-tier Tribunal, and the gov.uk guidance on open market rent determination sets out the process.

Is open market rent the same as market rent?

For practical purposes in the context of assured tenancies in England, yes. The terms are used interchangeably in housing law. The precise statutory phrase in the Housing Act 1988 as amended by the Renters' Rights Act 2025 is "open-market rent", defined as the rent the tribunal determines on the application.