Rent Increase Rules Under the Renters’ Rights Act: Section 13 Notice vs New Tenancy Agreements

Overview of Rent Increase Options

While there is no legal requirement to issue a new Assured Periodic Tenancy (APT), each approach has different legal and practical implications for landlords and tenants. Understanding these differences is essential when deciding how to proceed.

What Happens to Existing AST Agreements?

If tenants originally signed an Assured Shorthold Tenancy (AST), certain terms will continue after the Renters’ Rights Act takes effect.

One key example is the tenant’s notice period.

In many AST agreements, tenants can end the tenancy by giving one month’s notice aligned with the rental payment period. Unless a new tenancy agreement is signed, this term will remain in place.

Option 1: Serving a Section 13 Rent Increase Notice

Advantages

• The tenant does not need to agree or sign for the rent increase to take effect.
• The process is straightforward.
• Useful where tenants are unwilling to sign a new agreement.

Disadvantages

• The tenant’s notice period remains unchanged.
• The tenant may still be able to end the tenancy by giving one month’s notice.
• No additional contractual protections are gained by the landlord.

Option 2: Signing a New Assured Periodic Tenancy (APT)

If both parties agree, a new APT can be created at the increased rent. The tenant is under no obligation to sign.

Advantages

• Tenants would generally be required to give two months’ notice to end the tenancy.
• Provides greater stability and predictability for landlords.
• Allows all tenancy terms to be updated in line with current legislation.

Disadvantages

• The tenant may refuse to sign the new agreement.
• If refused, a Section 13 notice will be the only option to increase rent.
• Landlords cannot recover possession for 12 months using grounds of selling or moving in (Other possession grounds remain available during this period).

Can Tenants Challenge a Rent Increase?

Yes. In both cases, tenants may apply to a Rent Tribunal if they believe the proposed rent exceeds the market rate.

The tribunal will assess whether the rent is consistent with similar properties in the local area.

Which Option Is Better for Landlords?

Section 13 Notice May Be Better If:

• You want a simple, unilateral rent increase.
• The tenant is unlikely to agree to a new tenancy.
• You want to retain flexibility around possession.

New APT May Be Better If:

• You want tenants to provide longer notice periods.
• You prefer greater tenancy stability.
• You are comfortable with reduced possession flexibility for 12 months.
• The tenant is cooperative.

Final Thoughts

The Renters’ Rights Act introduces important changes to tenancy structures and landlord powers.

While issuing a new APT is not required, it may offer strategic advantages depending on your goals.

Landlords should carefully consider possession needs, tenant cooperation, and desired flexibility before choosing a rent increase method.

Professional legal advice should be sought where there is uncertainty about tenancy rights or possession grounds.