Q. I’m currently renting in Canary Wharf and have been happily living in the same property for the last three years. However, I have just had news from my agent that my Landlord intends to put my rent up from £375pw to £425pw – just like that! Surely this is not right, have rents really increased that much, and is he allowed to increase the rent that much in one hit?
A. This is a tale I’m hearing frequently at the moment. Unfortunately for you – yes rents have gone up that much! And if you rented in 2008 you would have secured a very low rent following the aftermath of the initial credit crunch that hit early that year. Back then tenants were in the driving seat and for the first time in all my years as an agent we saw rents being negotiated downwards as the crunch bit in, leaving landlords with no choice but to accept or risk having a void period on their investment. Today however we are seeing a totally different market despite the current economic climate rents are through the roof and stronger than ever. But why is this, if the economic climate is still this shaky surely rents should be competitive. The simple answer is, it’s due to a supply and demand issue. With less and less people in the market to buy these days, what with the difficulty of securing a mortgage unless you can stomp up a decent deposit it seems more people than usual are remaining in the rental market thus causing a shortage of property to rent and pushing the prices up. That being the case landlords that would normally take the view that they have had great tenants for the last couple of years and would usually only increase the rent by a reasonable amount are not afraid to demand the going rate even if it means as much as an extra £50.00 per week as they are confident that if you don’t pay it they can easily achieve it if you decide to leave. I have seen tenants recently in such outrage over this and they have served notice and are looking for another property, but be warned you are not likely to find anything more completive so think carefully and do your homework before deciding to quit. It is perfectly acceptable for the landlord to demand the market rent for his property, although the majority of landlords value great long standing tenants and would be open to negotiate in order for you to stay but of course you will always get the minority that are financially motivated who would not be interested in anything other than the money in the bank.