A Manchester landlord is grappling with a difficult decision: whether to raise a single mother's rent by 20% or sell his property. Mark, 63, has owned two buy-to-let properties for 18 years as a pension investment, but rising costs and regulatory changes have eroded his profits.
The Landlord's Predicament
Mark explains that rule changes, reduced tax relief, and higher mortgage rates have wiped out his profits. If he sells, he could walk away with about £220,000. However, keeping the properties would require a 20% rent increase to cover costs. One tenant, a single mother of seven years, says she cannot afford the hike. Mark feels torn but insists he is not running a charity.
Consumer Champion's Advice
Consumer expert Sarah Davidson acknowledges the dilemma facing many private landlords. She notes that the Renters' Rights Act, effective from May 2026, bans no-fault evictions and restricts rent increases. A 20% hike may be challenged if it exceeds market rates, which in Manchester average £1,347 with growth at 2.8%.
Davidson advises against evicting the tenant solely to sell. Instead, she suggests selling the property with the tenant in situ, allowing her to remain while Mark extracts his capital. This compassionate approach avoids making the tenant pay for the landlord's financial changes.
Key considerations include:
- The Renters' Rights Act limits rent increases; excessive hikes can be challenged at a tribunal.
- Evicting a long-term tenant requires four months' notice if selling.
- Selling with tenants in situ offers a middle ground, preserving their home while allowing the landlord to exit.
Davidson concludes that if the business no longer works, it should be closed with compassion.
