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Reducing the Rent

How do I reduce the rent?

The means by which a landlord actually instigates a rent reduction are varied and will depend on the terms of the tenancy.

The most obvious way to do it one would think would be to issue a section 13 notice.

However, the section 13 notice can only be used by landlords to increase the rent.

Neither is it possible to just grant a rent reduction verbally, or even by letter. Both these options would be unenforceable because of the lack of contractual consideration.

The only sure ways to reduce rent are:

a. Creating a new tenancy agreement at the reduced rent; or
b. Deed of Variation (because anything embodied in a Deed circumvents the ‘lack of contractual consideration’ problem).

For most landlords the easiest solution is to grant a new tenancy. The complication to this arises if the tenant is behind on the payment of their rent. This is because by granting a new tenancy the rent arrears will become a ‘former tenant’ debt, and thus cannot be used as a formal grounds for possession in relation to the new tenancy.

The only way around this is to insert a rather technical clause in the tenancy agreement making the repayment of any former rent arrears a condition of the new agreement. The other way is to get the tenant to sign a deed.

The simplest and most advisable method is to require the tenant to bring their rental account up to date before revising the agreement.

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