The Government may be focusing on letting agent fees to make renting fairer for tenants, but an interesting story has emerged regarding landlord contracts with their lenders.
A clause in buy-to-let deals with Santander asks landlords to increase rents by “as much as can be reasonably achieved”.
The clause states: “a) …a reasonable time before any opportunity arises for a review of the rent payable under the lease, you will get written advice from a qualified valuer who is a member of the RICS whether the market rent at the date of the review is likely to be higher than the rent currently payable under the lease;
b) You will provide us with a copy of the valuer’s advice;
c) If the valuer advises that the market rent at the date of the review is likely to be higher than the current rent, you will promptly take all steps which it is open to you to take under the lease to ensure that the review takes place and leads to the maximum increase in the rent which can reasonably be achieved;
d) You will notify us promptly of the result of the review.”
Commenting on the clause, Chris Norris, head of policy at the National Landlords Association, told EYE: “It doesn’t seem to be in anyone’s interest. Of course, a landlord wants to maximise their income, but that means coming to an arrangement with your tenants that is suitable for both parties.”
A Santander spokesman said this clause would be reviewed to clear up any confusion.