This is another right which many tenants feel either is not strong enough or which they don’t have at all. However there is some limited protection.
Protected tenants (Rent Act 1977)
If you are lucky enough to be a protected tenant (ie if your tenancy started before 15 January 1989) then you will be able to claim a ‘fair rent’ and your landlord will only be able to charge the rent set by the Rent Officer. This can normally only be increased every two years.
The protected tenancy regime is very favourable to tenants. However back in the 1970’s and 1980’s when this was the main tenancy type, landlords became unwilling to rent property if they had no power to set a market rent.
As a result, the private rented sector dwindled to about 7% of households by the 1980’s. It was only after the Housing Act 1988 was passed, allowing landlords more freedom to charge a market rent (and to evict tenants as of right under section 21), that the private rented sector started to grow again.
Assured and Assured Shorthold tenancies (Housing Act 1988)
These are the tenancies which are created today, when a new tenancy is created (apart from in a few special cases) and they only carry limited rent protection rights. These are
- If a landlord wishes to increase the rent under the notice procedure under section 13 of the act, a tenant has the right to refer the rent to the First Tier Tribunal for review if they feel it is more than a market rent
- For assured shorthold tenancies only, the tenant has the right to refer the rent to the First Tier Tribunal during the first six months of the tenancy, if the rent is not a market rent.
The problem with this is that most landlords prefer to increase the rent by another means, usually by refusing to continue the tenancy unless the tenant signs a new tenancy agreement at a higher rent. As the landlord has the right to evict the tenants if they do not agree to the new rent, most tenants will sign.
The right is more important for assured tenancies as there the landlord cannot use section 21. Assured tenancies are rare in the private sector however.
Tenants should also be aware that even if they are able to exercise this right, the First Tier Tribunal can adjust the rent up as well as down. So if the landlord’s proposed rent is actually lower than the market rent, the tribunal will increase it. So requesting a review is always a bit of a risk.
Tenants contractual rights
As well as the special rights under the legislation, tenants also have their contractual rights. This is that the landlord cannot just increase the rent willy-nilly, against the tenants wishes. The rent can only be increased via one of the proper procedures:
- By agreement
- Via the notice procedure, or
- By a rent review clause in the tenancy agreement
The Right of Set-off
Tenants also have a limited right to offset the cost of essential repair work against the rent, where the landlord has been asked but refuses to carry this out.
This right is limited however and you have to follow the proper procedure.
Action – if your rent has been increased in a manner which is not legally binding on you, you have the right to refuse to pay the increased rent and carry on paying the current rent.
Landlord Law Blog Posts
- Tenants legal help – is that rent increase valid?
- Tenants legal help – doing the repair work yourself
Action – if you want to challenge your rent to the tribunal, you will find some guidance on the .gov.uk website here.