URGENT advice please re PRIVATE TENANT rights?

Question

I am a private tenant (my cousins friend). We agreed that I would have a 3 year contract in which I would have first rights to buy the house and if I did not want it buy by then, they would want to sell. We agreed a rent of £500 per month, in which the rent would be REVIEWED TWICE yearly at 6 monthly intervals.
After the first 6 months, she said she wanted to put the rent up to £550 as intrest rates has rose, which we said fine, that was May 07 (we moved in Nov 06). She asked us 2 weeks ago if we knew if we were in a position to buy yet. She knows I am expecting a baby In Dec 07 and that I will starting maternity leave soon. So I said no, not till after maternity would we look into it, as I am going to be on less income, which should make no difference as at the end of the day, we have a 3 year contract. I have received a txt from her today saying she wants to increase the rent, again, as interest up to £600. Firstly, the next review wouldnt be up till Nov so that is against the . . .

contract, as it would be November. But at end of day I cant really afford that when I am going to be off work for 6 months. She told us all she wanted was the rent to cover her mortgage, as the rented it to us because she had been unable to sell it in time before she moved to a new house and relocated down south. I know interest rates have gone up but surely it cant affect your mortgage paymentsto go up £100 in less than a year. I think she isjust taking the mick and has got us over a barrel cos she knows we are expecting a baby and have just redecorated the house - nursery etc (that we have paid for). What are my rights? Can she really put it up that much so soon???? Any advice welcome. THANKS.

I know, from my cousin, she only renewed that morgage (which was only for 30,00 as that was all she had left to pay on it) when we moved in because she had to add the equity of this house to be able to afford her new one. We did her a favour because it had been up on the market for 8 month and she had dropped the price from 169,00 to 162,00 and still no one had bought it and she couldnt find anyone to rent either. She was going to get a legal solicitors contract but she didnt, all she ended up sending was a typed out pc print with her signature on and another for us to return to her.
The contract states -
Rental price agrred at £500 per calender, the rent will be reiewed twice yearly at 6 monthly intervals it has been agreed between both parties that the property will be let untill a time when the current occupiers (US) are in a position to purchase the property, at full market value.

Therefore I guess although we discussed buying it within or at the end of our 3 year contract 3 years isnt actually mentioned - it givesthe indication that it could be whenever we could afford it. Doesnt it???
Because she is a family friend, we have never had anything else written, the rent requests etc have all been via txts. She told us to treat it as our own home and we could redecorate do what we wanted etc. We have maintained the house, redecorated, bought new fences etc and never asked her for a contribution.
Yes, the rent maybe lower than what you flks down South are paying but actually rent and house prices are a lot less in the north west, everyone knows that. That is why people get paid a higher salary etc to represent the cost of living down there - so to be fair you cant compare it to up here!!

For those who wanted an update, I spoke with her, it turns out from Sept her mortage will be £6 more but she wanted £50, for her less than 1% increase rate she wanted to charge us 10% increase in rent. I told her no, its not acceptable, that she was going back on her word and that she had already increased it before it was due and by the contract she cant REVIEW it till December. Told her again that the reason we were not going to buy yet was we wanted to wait till after my maternity leave. Anyway, it seems she is just struggling with her payments and apparently she is going to try and change the mortgage on the house to a fixed rate one, so we will see!!! And yes lol I was i tad mad at the time. Thanks to all the responses!!!

Answer 1

It doesn't matter whether interest rates rise every month, if your contract states the rent is reviewed every six months, the landlord has to find the shortfall because it is an agreement between you. I'm in the same position with 2 rental properties of my own and haven't put up the rent in 2 years! Refuse to pay it - what is she going to do - leave the property empty until it is either re-let or sold? Something towards the mortgage is better than nothing. It's her own stupid fault for cutting corners to save money - she should have obtained a proper tenancy agreement. I'm a landlord myself, so I guess I should be on the side of the landlord, but you're being taken for a ride here - especially that you are improving the property by re-decoration etc. Stand firm - she wont evict you because she cant afford to leave it empty. There's a limit as to how much she could expect to get in rent via an agency/private advert anyway. Let us know what happens here, I'd be very interested. Good luck with it all and dont let it stress you out, you are pregnant after all.

Answer 2

Whatever you do dont go into this thinking that you are going to get your own back. Keep calm and realise that she prob isnt taking the mick and the interest could easily have gone up that much considering the current climate. The problem you have is that the contract doesnt sound too great. Im guessing that it isnt anything official and has been drawn up by either you or the owner. You would be in the stronger position if you were dealing with a poor contract and you had been in the property for a significant amount of time as your rights go up after so many years. This doesnt sound like the case though. Feel free to get help from the cit advice but I think you will find that you have gone into this without any protection from a good contract. The owner has done the same but unfortunatly in this case they have the law on their side. Technically they could make you leave at any time. If it was me I would say that you are perfectly happy for the rent to go up but not until november. You may find that they will go for that. If they dont tell them you'll move out remembering to remind them that if the house sits empty they will be losing £550 as a pose to £50 for the next few months. Thats a very strong bargaining argument. I would put money on that they will take that! Give it a go. You can always go back on it and say that you will pay it and then just leave as soon as you have found something more appopriate.

Answer 3

Hi,

As you have a contract, she cannot raise the rent early. In fact, the agreement to review should work both ways and I don't think that you are obliged to agree with any increase she decides to levy upon you.

Speak to her as she obviously wants to either increase the rent to give her more cash, or her mortgage really is going up that much.

BTW, if what you are paying her is covering her mortgage, why don't you buy it from her and continue to pay the same amount but be paying off a mortgage instead.

If neither of these things works, would she consider selling the house with a sitting tenant (i.e. you continue to rent the house but you pay the new owner the rent).

If you are going to rent it for 3 years (assuming the rent doesn't go any higher than £600) you will have paid £27900 in rent. If you can, try to buy it now.

Good luck, I hope it all works out for you. Congrats on the baby, I hope it all goes well.

Answer 4

So basically your landlord's doing you a favour by charging you rent that only covers the mortgage rather than the market rate?

Interest rates have gone up loads in the past year, particularly if they've just come to the end of a fixed rate deal their payments could have jumped £100-200 pound a month quite easily.

If you agreed 6 monthly rent reviews then they should stick to that, but I think you will be looking at an increase in November. If you can't pay it then you'll probably have to look for somewhere else to live.

Answer 5

Depends on the size of her mortgage - but absolutely yes that amount (£50) can be the result of a half point interest rise on not a particularly huge mortgage - and we have had that in both the last six month periods... the only thing I guess you can hold out for is not to have the second rise imposed until November. I don't think you're going to have a lot of joy consulting a rent tribunal because for a full house, a rental of £600 a month is actually VERY low. And £600 per month does not represent a very substantial mortgage - I'm guessing that she won;t have much mire than £100k buying power on that amount per month. Unless it is in a tiny house or in a very deprived area, £600 for a full house is in 'doing someone a BIG favour' territory. However, with interest rates due up again a couple of times before they peak, you will be looking at another rise in May 08, with very little doubt. Suggest you look at you alternatives and look at the rents for equivalent accommodation, and only then will you be able to assess who is doing who any favours here - and if you decide she's taking the mick, give her a months notice and move to one of the places you've seen that's cheaper....

Answer 6

Boy, were you mad when you wrote this. If she agreed a rent of £500 a month with bi yearly reviews, then she can't increase the rent because HER mortgage has gone up. That is her problem.
I would have thought she would be grateful to get £500 a month than nothing!.
And as you say, her mortgage is only £30k, £500 a month covers it easily with money to spare.
The cost of living in the south east is expensive and she is expecting you to pay for it!.
My advice would be to contact the Rent Tribunal and have the rent assessed. Their decision is legally binding.
If she doesn't like it....... tough!
I have listed a website for you to contact.

Answer 7

if you have a signed contract stating that you have a 3 year tenancy for this property, and on that should be the monthly payments required for the rent then i think you have a good case against her. i live in a rented property £495 per month, i have a signed tenancy agreement stating the monthly rent and i have rented this property for 2 years and the rent has never gone up.

i would pop along to your nearest citizens advice with a copy of your agreement and get some proper legal advice from them, because i think the rent increases are unfair, and the fact that it was agreed you would be able to live there for 3 years should go in your favour.

hope this helps.

Answer 8

Contact your local council. I am sure they have a department that deals with tenants rights. Did you sign the three year contract which states £500 per month rent? If so you may find that she can't increase your rent. I privately rented but had to sign my agreement anually and it was only at this time the landlord could increase my rent.

I take it you are in the UK. Answers come from different countries. UK and USA law will differ

Answer 9

She is entitled to put it up in November and not before. She can put it up however far she likes as its her house.

You appear to have agreed to allow her to sell the house (offering it to you first) at any stage in your 3 year contract.

Its irrelevent what the details are her reasoning is behind the increases - she can do as she pleases and need not have a debate with you about it.

You are in a poor position with a very poor contract.

I suggest you get in touch with the local government and housing associations/social development schemes and look for property under the part buy/part let scheme - you will probably find something suitable in that which will allow you a small foothold on the property ladder with a guaranteed option to pick up the remaining % later. I think you need a more secure tenancy for bringing up a family.

£500 per month is cheap for renting a house - many people are paying over £1,000 a month in rent here in London for bedsits or one bed flats!

Answer 10

Go to your local Citizens Advice Bureau who may well link you up with the Rent Officer Service who will set a fair rent for the property you occupy. Once this is done, you may well be paying less rent but don't expect the landlady to ever speak to you again