With the introduction of the Renters’ Rights Act, the rules governing rent increases in England have changed significantly. Letting agents are increasingly being asked how and when rent can be increased, what notice must be given, and what happens if a tenant disputes the increase.
This guide outlines the key points landlords need to understand to ensure any rent increase is carried out lawfully and fairly.
How have the rules changed?
The Renters’ Rights Act has introduced a new framework for residential tenancies. Fixed-term assured shorthold tenancies and contractual rent-review clauses have been removed, with most residential tenancies now operating on a periodic basis. As a result, rent increases must follow a prescribed legal process.
In England, landlords can increase rent only once in any 12-month period and cannot increase it during the first year of a tenancy. Any increase must be made using the statutory Section 13 procedure.
Rent increase rules across the UK
Although many of the recent changes have focused on England, landlords should remember that housing legislation differs across the UK. If you own property outside England, separate rules apply.
Wales
In Wales, landlords can generally increase rent once during any 12-month period and must provide tenants with at least two months’ notice. The prescribed RHW12 form must be used when notifying tenants of a proposed increase.
Landlords with Welsh properties should ensure the correct documentation is used, as an incorrectly served notice may invalidate the rent review.
Scotland
Scottish landlords are required to provide at least three months’ notice when increasing rent. As in England and Wales, rent can typically only be increased once every 12 months. Specific notice requirements apply and should be followed carefully.
Before implementing any increase, landlords should ensure they are using the latest Scottish procedures and prescribed notices.
Northern Ireland
In Northern Ireland, landlords must provide at least three months’ written notice before a rent increase takes effect. Notice can usually be given through agreed-upon written communication methods, such as a letter or an email. Rent reviews are generally limited to one increase every 12 months.
The Section 13 process
The Section 13 notice is now the standard method for increasing rent during a tenancy in England. Landlords wishing to increase the rent must:
- Serve the correct Section 13 notice
- Provide tenants with at least two months’ notice
- Ensure the increase takes effect no more than once every 12 months
- Follow the statutory procedure accurately
Failure to comply with the correct process can invalidate the proposed increase, leaving landlords unable to enforce the new rent.
What makes a rent increase reasonable?
Unlike some areas of the housing sector, there is currently no specific cap on rent increases in England’s private rental market. However, landlords are expected to set rents that reflect current market conditions.
When considering a rent review, landlords should assess:
- Comparable properties in the local area
- Property size, condition, and features
- Demand within the local rental market
- Recent market movements and trends
A rent increase that significantly exceeds local market levels may be difficult to justify and could be challenged by the tenant.
Best practice before increasing rent
Although the formal notice process is a legal requirement, many letting agents recommend discussing the proposed increase with tenants before serving notice. Open communication can help:
- Manage expectations
- Reduce the likelihood of disputes
- Maintain positive landlord-tenant relationships
- Increase the chance of agreement being reached without challenge
A transparent approach often leads to smoother tenancy management and better long-term outcomes for both parties.
What if a tenant challenges the increase?
Tenants have the right to challenge a proposed rent increase if they believe:
- The rent exceeds market value
- The Section 13 notice has been completed incorrectly
- The correct notice period has not been provided
In England, disputes can be referred to the First-tier Tribunal, which will assess local market evidence and determine whether the proposed rent is appropriate. The tribunal may:
- Approve the proposed increase
- Set a lower rent
- Reject an increase that is unsupported by market evidence
Importantly, the tribunal cannot impose a rent higher than the amount originally proposed by the landlord.
Can a tenant be evicted for refusing a rent increase?
Landlords cannot evict a tenant because they disagree with a proposed rent increase. Any possession action must be based on the legal grounds available under current housing legislation and cannot be used merely as a response to a rent dispute.
This makes it increasingly important for landlords to ensure rent increases are evidence-based and supported by local market conditions.
Should landlords increase rent every year?
There is no requirement to review rent annually. The decision will depend on individual circumstances, market conditions, and investment objectives.
Factors landlords may wish to consider include:
- Whether the existing rent remains competitive
- The value of retaining a dependable tenant
- Local supply and demand
- Rising property and maintenance costs
- Tenant affordability
In some situations, smaller and more regular increases may be easier for tenants to accommodate than a substantial adjustment after several years without change. Equally, landlords should consider the potential impact on tenant retention before making a decision.
Affordability considerations
When reviewing rent levels, landlords should also be mindful of the affordability pressures tenants face. Significant rent rises can increase the risk of payment difficulties and, in some cases, rent arrears.
For tenants receiving housing-related benefits, any increase that exceeds local support thresholds could create financial strain and affect their ability to meet ongoing rental obligations.
Protecting rental income
As possession routes have changed under the Renters’ Rights Act, recovering possession for rent arrears may take longer. Maintaining robust referencing procedures, carrying out regular tenancy reviews, and considering appropriate insurance protection can help reduce financial exposure should payment issues arise.
Landlords should also be aware that some legal & rent guarantee policies may include conditions requiring affordability checks following substantial rent increases, making it important to review the policy terms before implementing significant changes.
The ability to increase rent remains available to landlords, but the process is now more regulated. Any rent review must follow the Section 13 procedure, be supported by market evidence and be limited to one increase every 12 months. By taking a measured, transparent approach and considering tenant affordability alongside market conditions, landlords can help protect both their investment and their tenant relationships. For further protection from rent arrears and legal issues, landlords should consider legal & rent guarantee insurance. To find out more, contact Alan Boswell Group on 01603 649727.
This article is intended as a guide only. Please note that legislation does change, it is always best to check the most up to date guidance on gov.uk. Most landlord insurance policies arranged by Alan Boswell Group also have access to a legal advice helpline where policyholders can seek further advice.
