A controversial landlord, who has previously made headlines for banning “coloured” tenants and single mothers, has made headlines again by increasing rent within half an hour of the Bank of England’s interest rate hike.
Controversial Letting Policies
Fergus Wilson, along with his wife Judith, are millionaire landlords. Although they sold their entire property portfolio in 2015, for £250m, they have rebuilt their buy to let empire. However, Wilson has continued to court controversy, having recently banned “coloured” tenants because he said that they leave “a curry smell” behind, and he has also banned single mothers and mothers with new babies from renting his properties.
Last year, an email from Mr Wilson to his letting agents, which asked the agents to ban “coloured” people from renting his property, was leaked to the Sun newspaper. Following the leak, Mr Wilson was ordered to lift the ban by Maidstone County Court, which judged his policy to be illegal. In January this year, it emerged that Mr Wilson had threatened to take legal action against a video blogger who had accused him of racism; a claim that Wilson himself denies, pointing to the fact that he also bans smoking and dogs.
The move has not led to Mr Wilson easing his opinions. In the past, he has banned zero-hours workers, single parents, battered wives, parents with children under the age of 18, low income workers, and has said that he was owed nearly £1m by housing benefit claimants before banning them from renting his Kent-based properties.
Mr Wilson has reiterated his stance that all of these decisions are business and economic decisions and are not based on biased.
The controversial landlord has hit headlines, once again, after it emerged that he has increased the rent for all his tenants immediately following the Bank of England announcement that they would be increasing interest rates by 0.25%.
Within half an hour of the announcement, Mr Wilson had informed his letting agent that rent for all tenants in his 400 homes would be increased by £50 per month. While making the announcement, Mr Wilson said that he was merely passing on the increased mortgage rates that he would face and said that it was fair to do so because he decreases rent when interest rates go down.
He said that the rent would increase straight away, but also pointed out that a lot of new tenants would be protected for a period of between 6 months and 12 months. Wilson said, “when interest rates went down we actually put it down £50”, referring to his rental charges. He also went on to say “the tenants in a way are protected for up to a year by bits of legislation” before saying “if someone signed an agreement yesterday, legally they won’t have to pay the increase for six months.”
Interest Rate Rise
The Bank of England announced that it would put interest rates up from 0.5% to 0.75%. Some banks and building societies have said that they will not pass on the full rise to savers, but almost all have said that mortgage base rates will increase by the 0.5%, which means that landlords relying on a mortgage to pay for the property are likely to put up their prices in the coming months. However, tenants do enjoy a degree of protection from unexpected rental hikes, although this isn’t always the case.
Can Landlords Increase Rent?
Rent increases are dealt with according to the type and length of rental agreement a tenant has. Most tenants are placed on assured shorthold tenancy agreements. With this type of agreement, landlords do have opportunity to raise interest rates. Most agreements will include a provision for the landlord to increase rent according to market rates. This means that they can raise rent according to the typical rental rates for similar properties in your area, and it is possible for the property owner to do this every year. However, not all landlords raise rates every year.
Fixed Term Agreements And Rolling Contracts
If you are currently under a fixed term agreement, the landlord cannot raise rent until the end of the fixed rate term. If you renew your tenancy by signing a new agreement at the end of every term, this is your landlord’s opportunity to increase monthly payments.
If you are on a rolling contract, which means that your fixed term has ended but you have not signed a new deal, then your landlord can increase rent at any time, and only needs to give you a month’s notice.
Protection For New Tenants
If you have just signed a new, 6 month tenancy agreement, then it is highly unlikely that there is any provision within the agreement that would enable the landlord to increase rent before the end of this period.
Rental Increases And Action To Be Taken
If your landlord increases their rent, you should check your tenancy agreement first. Determine whether you are still in the fixed term period, how long your agreement is for, and whether there are provisions made that would allow the landlord to increase rent. If you believe a rental increase is unfair, start by talking to your landlord. You may be able to agree to a reduced increase or the landlord might agree to extend the lower rental period. If you fail to come to an agreement with the landlord, you may have legal recourse to be able to prevent the increase, although this will depend on your existing agreement.
PDF Estates Property Management
At PDF Estates, we offer complete transparency and fair pricing. Although some rental increases are inevitable, according to market conditions and interest rates, we only increase rent when absolutely necessary and when rental agreements allow for it. We aim to foster a positive and long-term relationship between our landlords and every tenant, and we firmly believe that transparency and trust are key to these relationships.
If you are a landlord, whether you have a single property or an expanding property portfolio, call us today on 020 3815 7952 or email firstname.lastname@example.org to ask about our offer of 3 free months of full property management.