Published: 07/03/2023 By Rob GibbensDoes your tenant pay their rent every month without any problems?
Perhaps they’re so great that you never hear from them about any repairs and everything is going so well that you don’t want to rattle the cage and risk losing such a good tenant by increasing the rent.
As good as your tenants may seem, failing to review the rent can prove to be very, very expensive.
You might think to yourself – ‘I’m doing okay, I don’t need the money, I’m happy with the tenant so I’ll just leave things as they are’, which is fine, until it isn’t.
Do you have a BTL mortgage?
Is it coming to an end soon?
Presumably you’ll look to re-mortgage at the end of the fixed term which, for the last 10 years, hasn’t been a problem. Consistently low interest rates alongside consistently increasing property values meant that there were never going to be many issues passing Lender’s affordability tests, however, the same can’t be guaranteed today.
A portfolio landlord recently came into our Mortgage Adviser with the intention of remortgaging his rental properties, as he has done many times before. Applications were submitted on 4 properties and all declined due to one of them not standing up to affordability tests.
The property was originally rented out for £525 per calendar month in 2013, a year later the rent was reviewed to £550, the Landlord then moved Agent and it has never been reviewed since.
The property was brought to KEY for us to manage. We negotiated a rent increase to £695 per calendar month with the tenant and subsequently the remortgage applications have been approved.
A regular annual rent increase to keep it in line with the market would have been much better for the tenant and could have saved the landlord many sleepless nights.
If you would like to discuss whether the rent for your property is at the current market rent, we would be happy to discuss this with you and also discuss more broadly how KEY could help you manage your portfolio to maximise the return on investment.
Call KEY on 024 7632 2022 or email us email@example.com and we will be happy to arrange an appointment or phone call with one of our Lettings Specialists.