Tenants fight back against rising rents

Terraced housesAFP/Getty Images

Tenants have begun to fight back against the sharp increases in rents landlords have been pushing through in recent years. Landlords have taken full advantage of the fact that many people can't afford to buy their own home, due to the high deposits demanded by lenders.

But this is starting to change, and rent increases slowed at the start of this year, according to the latest residential lettings survey from the Royal Institution of Chartered Surveyors. So how do you go about getting your rent lowered?
Rents are still going up across the UK, but at the slowest pace in two years. In the three months to January, a net balance of 13% of surveyors reported higher rents, down from 21% in the previous quarter. This suggests that the market may be beginning to level out as tenants are less willing to pay increasing rents, RICS said.

Surveyors in the north of England reported the lowest rental reading in the country, while in London the increase in rents was the smallest since mid-2009.

And this is set to continue. Some 14% of surveyors predicted rises rather than falls in prices, down from 24% in the previous quarter.

Demand for rented accommodation remains reasonably strong, with 19% more surveyors reporting rises rather than falls in interest from prospective tenants. But an increasing number of first-time buyers are looking to beat the expiry of the stamp duty holiday on 24 March, and so are turning to the sales market rather than renting - mortgage approvals hit a 25-month high in January.

Since the financial crisis struck, many would-be first-time buyers have been stuck in rented accommodation or at home with their parents, as they can't stump up the average £40,000 deposit demanded by most lenders.

NewBuy scheme with £10,000 deposit
However, help is at hand - the government-sponsored NewBuy scheme will offer first-time buyers and movers a mortgage with a deposit of just £10,000 for a newly built property priced up to £500,000. The scheme is expected to be launched next Monday and David Cameron has suggested this could help 100,000 people who are trying to get on the housing ladder. The previous FirstBuy scheme, under which the government and the property developer invest equal amounts and the buyer only puts down 5%, has also helped to some extent.

With rental growth beginning to slow in many areas of the country, more landlords are now looking to sell at the end of a tenancy agreement. 4% of landlords chose to place their property on the sales market in the three months to January, up from 2.6% in the previous quarter.

Michael Newey of RICS said: "With many potential first time buyers having been forced into rented accommodation due to problems with obtaining affordable mortgage finance, rental prices have grown quickly across much of the country in recent times. However, it seems that tenants may be becoming less willing to meet increasing rental values.

"While still growing, demand from potential tenants is also beginning to slow. With a recent upturn in buyers entering the sales market prior to the expiry of the stamp duty holiday in March, it seems that those who are in a position to get a foot on the property ladder may have chosen now to do so."

How to negotiate your rent
Before you march up to your landlord to demand a rent reduction, do your homework. Find out what other tenants in your building or neigbhourhood are paying. What's the market in your area like - how easy would it be for your landlord to find another tenant if you left? And how much would it cost them? Being a model tenant obviously helps, as your landlord will want to hang on to you.

You could promise to pay before the first of the month or sign a longer lease in return for cheaper rent. If you are looking for a new place, having references from past landlords or your employer, a regular income and a good credit score are obvious advantages. You should come across as a decent, clean, quiet tenant. You could also offer to paint the flat, keep the communal areas clean and tidy, or maintain the garden in return for reduced rent.

If you need further ammunition, I suppose you could point to the RICS survey as evidence that rents are generally starting to come down. Try to renegotiate your rent some time before your lease expires, to make sure you have enough time to find a new place if things don't go your way and you want to leave. But generally you have nothing to lose by asking for cheaper rent.

World's priciest cities to rent property
See Gallery
Tenants fight back against rising rents

More stories

Read Full Story