Rent increases under the Renters' Rights Act 2025

Why it matters

For landlords, understanding this process is crucial to ensure legal compliance, avoid disputes, and maintain a stable rental income. Incorrect procedures or unreasonable proposals can lead to delays in receiving increased rent, tribunal involvement, and potentially having a lower rent determined than intended. Proactive adherence to the regulations protects your investment and landlord-tenant relationship.

Legal requirements

• All rent increases for periodic tenancies in England must be proposed using the statutory 'Notice of proposed new rent' form, as specified under the Renters' Rights Act 2025.
• Landlords must provide a minimum of two months' notice before a proposed rent increase can take effect.
• Only one rent increase notice can be issued for a property within any 12-month period, commencing from the date the last increase took effect.
• The proposed new rent must reflect the open market rent for a property of a similar type, condition, and location.
• Any rent review clauses within a tenancy agreement that permit automatic or non-statutory rent increases are superseded and rendered ineffective by the Act's provisions.
• If a tenant challenges the rent increase, the landlord must provide evidence to the First-tier Tribunal (Property Chamber) supporting the proposed market rent.
• The landlord must ensure the property meets all legal obligations, including the Homes (Fitness for Human Habitation) Act 2018, as this may influence a tribunal's decision.
• Tenancy agreements must not contain terms attempting to circumvent the statutory rent increase process.

Common mistakes

• Failing to use the prescribed statutory notice form for rent increases, rendering the notice invalid.
• Attempting to increase rent more than once within a 12-month period, which is prohibited under the new legislation.
• Not providing the full statutory notice period, typically two months, before the proposed increase takes effect.
• Proposing a rent increase that significantly exceeds local market rates without adequate justification or comparable evidence.
• Believing that a rent review clause in the tenancy agreement still allows for automatic rent uplifts, rather than following the statutory process.
• Neglecting to keep clear records of the notice served, the method of service, and the date the new rent is intended to commence.
• Underestimating the importance of providing robust comparable evidence if a tenant challenges the proposed rent at tribunal.
• Trying to negotiate a new rent with the tenant outside the statutory notice process, which can lead to confusion and legal challenges.

Practical guidance

• Regularly research local rental market conditions to understand prevailing rates for properties similar to yours.
• Identify at least three or four genuinely comparable properties that have recently been let in your area, noting their size, condition, and amenities.
• Use the official 'Notice of proposed new rent' form, ensuring all sections are accurately completed.
• Serve the notice well in advance, allowing for the statutory notice period plus a few extra days for postal delivery if applicable.
• Consider including a covering letter explaining the reasons for the increase and providing your comparable evidence to pre-empt tenant concerns.
• Keep meticulous records of when the notice was served, how it was served, and the date the new rent is due to start.
• If a tenant challenges the increase at tribunal, be prepared to present your evidence clearly and concisely, demonstrating how you arrived at your proposed figure.
• Review your tenancy agreements to remove any outdated rent review clauses that contradict the Renters' Rights Act 2025.

The Statutory Rent Increase Process in England

The Renters' Rights Act 2025 introduces a single, mandatory route for increasing rent for assured periodic tenancies in England. This means that landlords can no longer rely on rent review clauses within tenancy agreements that aim to set out an alternative method for rent increases. Such clauses are now effectively overridden by the statutory process. To initiate a rent increase, a landlord must serve a specific 'Notice of proposed new rent' form, providing at least two months' notice. The proposed new rent can only take effect on or after the date specified in this notice. A crucial element of the new law is the 'one increase a year' rule; a landlord cannot serve a second notice to increase rent within 12 months of the date the previous increase took effect. This standardisation aims to provide tenants with greater certainty and protection against frequent or arbitrary rent hikes. It also places the onus on landlords to ensure their proposed rent is justifiable, as tenants have a right to challenge it.

Determining a Fair Market Rent and Tribunal Challenges

When proposing a new rent, it is essential that the figure reflects the open market rent for a comparable property. This is particularly important because if a tenant challenges the increase, the First-tier Tribunal (Property Chamber) will determine the market rent. The tribunal's decision is final and binding. Crucially, the tribunal cannot set the rent higher than the figure the landlord originally proposed in the notice. This means that proposing an 'over-ambitious' rent carries no upside; it only risks the tribunal setting a lower figure than what the landlord hoped for, and potentially lower than a more reasonable initial proposal. To support a proposed rent, landlords should gather robust evidence of comparable local properties – specifically, those of similar size, condition, and location that have recently been let. Online portal asking prices are generally not sufficient; actual achieved rents are preferred. Having this evidence readily available can help to justify your proposed increase and strengthen your position if challenged.

Rent Increases in Scotland, Wales, and Northern Ireland

The Renters' Rights Act 2025 applies to England only. Rent increase processes in Scotland, Wales, and Northern Ireland operate under their own distinct legislative frameworks. In Scotland, under the Private Residential Tenancy regime, landlords can only increase rent once every 12 months, and must give the tenant at least three months' notice. If the tenant believes the increase is unreasonable, they can apply to a Rent Officer for adjudication. For more details on the Scottish system, see our guide on The Private Residential Tenancy: a complete guide for Scottish landlords. In Wales, under the Renting Homes (Wales) Act 2022, rent can generally only be increased once every 12 months, with a minimum of two months' written notice. Contract-holders can refer an unreasonable increase to a Rent Assessment Committee. Our page, The Renting Homes (Wales) Act: a complete guide for landlords, provides further information. In Northern Ireland, rent increases for private tenancies typically require a minimum of 28 days' written notice, and there is no statutory limit on how often rent can be increased, although most tenancy agreements specify review periods. Tenants can refer a challenge to the Rent Assessment Committee if they believe the rent is excessive.

Practical Considerations for Landlords

To minimise disputes and ensure a smooth rent increase process, landlords should adopt a practical and transparent approach. When proposing an increase, consider including a polite covering letter alongside the statutory notice. This letter can briefly explain the reasons for the increase – perhaps referencing rising maintenance costs, inflation, or local market trends – and provide the comparable evidence you have gathered. This proactive communication can often prevent surprises and alleviate tenant concerns. Always ensure you record the date and method of service of the notice; sending it by recorded delivery or email with a read receipt provides proof of delivery. Keeping a copy of the completed notice and any supporting documentation is vital for your records, especially if a tribunal application is made. Remember, fostering a good relationship with your tenant through clear communication can often lead to a mutually agreeable outcome without the need for formal dispute resolution.