Follow rules to the letter
Cutting corners to save costs could end up costing you dear, says Yetunde Dania
In these austere times, it is imperative that registered housing providers seeking to increase their rent do so in accordance with the statutory requirements of section 13 of the Housing Act 1988, by serving them with rent increase notices in the prescribed form.
Short cuts to save pennies can end up being very costly indeed.
For example, not every provider appears to be aware that the guidance notes which accompany the Prescribed Notice - form 4B - for both tenants and landlords should be reproduced in their entirety. Sometimes, due to a desire to save money on, for example, printing costs, we see clients contemplating issuing rent increase notices without attaching the notes setting out some of the information. This temptation should be resisted at all costs.
If the notes are not provided and a tenant challenges the validity of the rent increase, the Rent Assessment Committee will determine that the rent increase notice is invalid.
If such a mistake is made in respect of a significant number of the providers’ properties, then the financial impact will potentially be significant as the error will have an impact upon the rental income going forward.
If you are looking to save money on printing costs, rather than cut out any of the guidance notes, consider printing the information on double-sided paper instead.
The statutory rent increase process can be a minefield. The key to a smooth process is to review your processes and documentation sooner rather than later.
Yetunde Dania is a partner at Shoosmiths