A Section 13 notice is an official rent increase notice that can be used for periodic assured or assured shorthold tenancies. In order for a Section 13 notice to be valid, landlords must follow notice requirements, such as providing sufficient notice time, increasing rent by a reasonable amount in line with market conditions, and informing tenants of their new rent payment due date.
To learn more about Section 13 notices and what they entail, see our FAQ down below.
What is a Section 13 notice?
A Section 13 notice is a formal notice, filled out by the landlord, informing tenants of a rent increase. Section 13 of the Housing Act 1988 allows landlords to increase rent prices for periodic assured or assured shorthold tenancies. The notice must follow specific guidelines and requirements in order to be deemed valid.
The rent increase proposed by a Section 13 notice must also be a reasonable increase that is in line with the market rate. Tenancy agreements with a rent review clause do not require a Section 13 notice, as the clause already permits landlords to increase rent.
How is Section 13 notice served?
Landlords must fill out Form 4 for Section 13 notices, as per Housing Act 1988 section 13(2), as amended by the Regulatory Reform (Assured Periodic Tenancies) (Rent Increases) Order 2003. The form requires landlords to disclose the current rate of rent, along with the proposed increase. The form will also include the starting date of the new rent price, along with guidance notes for future action, as well as any other increased charges.
How much notice do landlords need to provide under Section 13 before changes take effect?
Minimum notice periods for Section 13 differ according to the type of tenancy. For yearly tenancies, at least six months’ notice is needed for increasing rent prices. For periodic tenancies, paid on a week-by-week or month-by-month basis, at least one month minimum is required for a Section 13 notice.
Landlords cannot increase the rent more than once every 52 weeks for periodic tenancies. During fixed-term tenancies, rent increases can only occur if the landlord and tenant agree on the exchange. Landlords can increase rent prices without tenant permission after the fixed term is over.
When can I use an Section 13 notice?
Section 13 notices can only be used for periodic tenancies and can only be served once every 52 weeks. The notice cannot be served during the first 12 months of a contractual periodic tenancy. Section 13 notices must also inform tenants within the proper minimum notice period that corresponds to their tenancy agreement.
Section 13 notices can be used on fixed-term tenancies in instances where they have expired and become periodic tenancies. In this case, the notice can only be served after the tenancy becomes statutory periodic.
What happens after an Section 13 has been served?
If tenants accept the rent increase indicated in the Section 13 notice, they will pay the new rate on the next rent due date. Tenants can also dispute the Section 13 notice by referring to the First-tier Tribunal for a judgement.
What happens if tenants dispute the Section13?
Tenants are allowed to dispute the Section 13 notice by appealing to the First-tier Tribunal. The First-tier Tribunal, also known as the Property Chamber, is in charge of all applications and appeals related to property and land disputes. The referral application must be filed before the notice period expires. Tenants must use the correct form for their appeal, either Form 6 or Form Rents 1.
The tribunal will take a look at the application and determine whether the rent increase is in line with the market rate. This means assessing whether the proposed increase matches similar properties in the surrounding area. Upon review, the tribunal will approve the rent increase, order the rent to stay the same, or, some occasions, order the rent to be lowered.
What alternatives are there to using an Section 13?
One alternative to a Section 13 notice is a mutual agreement between the landlord and tenants to increase the rent. The mutual agreement should be presented in a written addendum created by the landlord. The document should be signed by both parties either via email or in person.
Another alternative for a Section 13 is a rent review clause in the tenancy agreement. Rent review clauses will indicate how much rent will increase by, when it will increase, and how much notice will be provided.
Section 13 notices can only be used for periodic assured tenancies and assured shorthold tenancies. Landlords looking to increase rent during the fixed term of a tenancy can only do so with the agreement of their tenants. If you want to ensure that you have the flexibility to react to changing market conditions later in a tenancy, it's worth negotiating a rent review clause with tenants in contracts longer than 12 months.
Those utilising Section 13 notices must remember in order for the notice to be valid, proper documentation and notice period notification must be followed.
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