any exceptions on rent increase restrictions for fixed short term leases?

jdall

Are there any exceptions to the rules on rent increase for a new 1 year lease agreement after the same tenants have finished a fixed short term lease of less than 6 months?

We intend to enter a short-term lease agreement with the intention of keeping the price reasonable with consideration of the heating costs for this property during the winter months. These tenants may opt to enter a new lease after 6 months but in that case the market value would be 50-100/month more than what we planned to charge for the short term lease with these tenants.

Thanks in advance.

Baby01032012

To answer your question...NO there are no exceptions and secondly dont do what your proposing to do. What ever rent you set now you will only be able to increase by a maximum of 4% after 12 months have lapsed and you will need to give 90 days notice. 6 months or 12 months lease have no bearing, once the tenant is in situ 6 months they have part IV rights no matter what is in the fixed term lease and have the right to continue for a period of 6 years bar very limited circumstances around selling, refurishment or relative moving in.
Plus rent you set now much be evidenced market rent if no previous tenancy.

jdall

Thanks for the clear and straight forward answer. Just thinking outloud, I wonder if its possible to set rent at what I think is market value right away and put a clause in the initial 6m contract that the certain utilities are included such as broadband and tv. When agreeing on a new contract after 6 months these utilities would not be covered. my assumption is that these extas would factor into the overall lease value making the same rules apply but curious if that's even a far fetched possibility.

Aside from that I'm wondering if Airbnb might be a better solution for short term letting.

Thanks

antoinolachtnai

jdall wrote: »

Thanks for the clear and straight forward answer. Just thinking outloud, I wonder if its possible to set rent at what I think is market value right away and put a clause in the initial 6m contract that the certain utilities are included such as broadband and tv. When agreeing on a new contract after 6 months these utilities would not be covered. my assumption is that these extas would factor into the overall lease value making the same rules apply but curious if that's even a far fetched possibility.

Aside from that I'm wondering if Airbnb might be a better solution for short term letting.

Thanks

You could put in a clause or have a side letter allowing for a rent free period, discretionary discount or refund equivalent to the discount. It’s not rock solid but it might do what you want.

In the end, you are running a business. You really need to be getting within 5 or 10 percent of the market rent, whatever that may be.

On the whole short tenancies attract higher rents than short tenancies.

Baby01032012

jdall wrote: »

Thanks for the clear and straight forward answer. Just thinking outloud, I wonder if its possible to set rent at what I think is market value right away and put a clause in the initial 6m contract that the certain utilities are included such as broadband and tv. When agreeing on a new contract after 6 months these utilities would not be covered. my assumption is that these extas would factor into the overall lease value making the same rules apply but curious if that's even a far fetched possibility.

Aside from that I'm wondering if Airbnb might be a better solution for short term letting.

Thanks

Rent free period as mentioned or utilities refuse parking are all used as extras but your just getting yourself into trouble putting something into contract now and then changing terms in 6 months. Maybe outside of contract refund them a months rent or give them cash back.

Askthe EA

Interestingly, the RTBs own calculator does allow you to increase the rent for a new tenancy where the rent was previously set within 12 months.

Baby01032012

Askthe EA wrote: »

Interestingly, the RTBs own calculator does allow you to increase the rent for a new tenancy where the rent was previously set within 12 months.

Of course it does, it’s 4% per annum or a proportion there of.