How Landlords Could Earn More Rent in 2025
Getting the rent right is a must for all landlords. Here we'll look at how to assess if the time is right to raise the rent on your investment property.
Should You Raise Your Rent in 2025?
We believe all landlords should review the rent they charge every year. And, if appropriate, increase it. (But there is a 'but' – see later.)
Here's Why
- Your landlord costs go up every year. You need the rent to keep pace so you can maintain your property to the standard tenants expect.
- Most tenants assume the rent will rise from time to time. (Everything else goes up, so why wouldn't the rent?)
- Most tenants prefer a moderate annual rise rather than no increase for years and then a big hike out of the blue.
Reviewing and, if need be, raising the rent every year is fair to both sides.
Why Reviewing Rent is More Important Than Ever
The Renters' Rights Bill, which is likely to become law this year, will change how rent increases work.
- Landlords will only be able to raise the rent once a year up to market rates.
- Landlords must give tenants two months' notice of any increase.
- Rental 'bidding wars' will be banned, meaning tenants cannot offer to pay more than the listed rent.
So, the rent you charge must be at the right level before this law comes into force.
When Raising the Rent Could Lose You Money
If the rent is already at, or above, market levels, a rent rise may be inadvisable. Such a move could prompt your tenant to move on, and you could struggle to find a new tenant willing to pay above-market rent.
How Do You Decide What the Right Rent Is?
You could take a guess. But it's much better to take advice from a local expert.
Letting agents know their local markets inside out. They know what other landlords are achieving and what tenants are prepared to pay. They can use this expert market knowledge to help you decide the optimum rent for your property.
We will be pleased to offer expert advice on setting the correct rent for your rental property. Feel free to give us a call or message us today.
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Frequently Asked Questions
1. How often should I review my rental price?
It's advisable to review rent annually to ensure it remains in line with the market and covers your increasing costs.
2. How much notice must I give tenants if I raise the rent?
Under the new Renters' Rights Bill, landlords will need to give tenants at least two months' notice of any rent increase.
3. Can I raise the rent above market rates?
Raising rent significantly above market rates could lead to tenant turnover and longer void periods. It's best to set a fair and competitive price.
4. How do I know what a fair rent increase is?
A local letting agent can provide expert guidance on current rental market trends and what tenants are willing to pay.
5. What if my tenant refuses a rent increase?
Tenants can challenge rent increases if they feel they are unfair. Keeping rent reasonable and in line with market rates reduces disputes.