Your property is already tenanted but you want to increase the rent. How much are you actually able to increase it by, though? It’s a common scenario, particularly in today’s rental market.
Monthly rents in Southwark have risen by 7.7% across 2024, according to Office for National Statistics (ONS) figures. Though as a local landlord, it’s likely that you’ve already seen rents on the rise in the local market. Whether you are keeping up with market rates, seeking to reflect improvements in the property, or keeping up with rising landlord costs, there comes a time when you want to increase the rent on your rental property in Waterloo, Borough, The Cut or Bermondsey.
In our article, we clarify how much a landlord can increase the rent in London.
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As a private landlord renting property under an assured shorthold tenancy, the exact rules on increasing the rent will depend on the type of tenancy agreement and its clauses.
Where tenants rent under a fixed-term tenancy, you can only increase the rent if there’s a rent review clause and you get the tenants’ agreement. If neither of these is an option, you will have to wait until the fixed term ends to propose the rent increase.
Under a periodic tenancy or statutory periodic tenancy (i.e. your tenants pay week by week or month by month), you can increase the rent but there are limits on how often.
Want to be a more informed landlord? Rent increases are increasingly shaped by the Renters’ Rights Act 2026, so weigh any rise against how much it costs to rent out a property overall.
Rent increases in the UK must be ‘fair and realistic’ and relate to the property’s market value on the local rental market. In other words, look to comparable properties in the same neighbourhood of South East London as a guide.
You can also use wage inflation as part of your calculation. Annual pay growth reached 5.9% at the end of 2024, according to ONS numbers. That said, property experts at Rightmove suggest that the London rental market is reaching an affordability ceiling. While they predict demand to remain strong, be aware that this could slow the steep rent rises we’ve seen recently.
There is no legal maximum rent increase percentage in the UK, but it should be in line with local average rents. If there’s a rent review clause in the contract then this may stipulate which formula is used to calculate rent increases. In either case, your tenants can go to the First-tier Tribunal if they think the proposed rent increase is too steep.
If you’re raising the rent on a periodic tenancy using Section 13, the notice period is a month’s notice for rent paid weekly or monthly, rising to 6 months’ notice for rent paid annually. To raise the rent under a rent review clause, check the original terms as the notice period will usually be specified in the tenancy agreement.
Landlords can usually increase the rent once a year for a periodic tenancy, unless you secure the tenants’ agreement. You can only serve a Section 13 notice once annually though.
In most cases, the landlord should increase a Section 13 rent increase notice, in line with the Housing Act 1988. The rent increase letter should explain the new rent amount and when it will come into effect.
Landlords can increase rent without issuing a Section 13 notice once a year on a periodic tenancy with a rent review clause, or if the landlord and tenant both agree to it. If this applies to you, set out at rent increase letter to form a written record, and get the tenants agreement in writing, in case they challenge it later on.
If a rent rise isn’t enough to make the numbers work, it may be time to consider whether you should sell your buy-to-let or look into rent guarantee insurance instead.
Landlords should be aware of the new Renters’ Rights Bill currently passing through parliament, which replaces the Conservative government’s Renters’ Reform Bill. It proposes implementing a firm limit on how much landlords can increase the rent by.
Landlords will be allowed to raise the rent in line with the local rental market with a Section 13 notice, and tenants will continue to be able to raise disputes with the First-Tier Tribunal. The bill could also end rent review clauses, and restrict landlords to one rent increase per year, toughening up the existing convention.
Have we clarified the picture on raising the rent and issuing a rent increase notice? Our team are ready to advise you about this or any other questions you may have about your rental property in London Bridge, Lower Marsh or Shad Thames. Contact Garrett Whitelock to find out more.
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