Rent reviews, stepped rents and price indexes
Each lease carries its own rent increases. Use a share or an amount every so many months, or stepped rents from set dates. Or use a price index such as CPI with a floor and a cap. Bills pick up the new rent on the day it starts.
PLANSEvery plan
The problem it solves
- The yearly 5 % increase is remembered three months late and cannot be billed back easily.
- A commercial lease has steps for years 1, 2 and 3, and someone has to change the rent on the right day.
- An index-linked rent needs the right month's figure, a floor and a cap, worked out in a spreadsheet.
How it works
- On the lease's Reviews and Breaks tab choose the Rent Review type.
- By a Share or By an Amount: give how often (every 12 months to start with) and by how much.
- Stepped Rents: list each date and the rent from that date. Confirm is refused until steps are entered.
- By an Index: choose the index, how often, and Read Months Back (3 to start with) for the published figure. Set At Least and At Most in %.
- Keep the index figures under Rentals > Configuration > Prices > Price Indexes, one value per month.
- Bills use the new rent from its date by themselves; Rent Schedule shows the effect in advance.
Everything it does
Review types
- No Review (the default)
- By a Share: a % every n months, compounded
- By an Amount: an amount added every n months
- Stepped Rents: a list of dates and the rent from each date
- By an Index: a price index such as CPI or RPI
- As the Rent Plan Says
Index-linked rent
- Index with a code, country and source, and its monthly values
- Read Months Back: the figure used is this many months before the review (3 to start with)
- At Least (%) and At Most (%) per review; 0 at most means no cap
- A missing figure gives no increase (or the floor, when one is set)
- Figures are entered by you; there is no automatic feed
How bills change
- Increases apply from the review date, day by day; a bill that spans the date is split
- Stepped rents replace the lease rent from each step's date
- Reviews count from the lease start
Who uses it
Lease userSets the review terms when writing the lease.
Lease ManagerEnters index figures each month.
AccountsSees the new rent on the next bill without typing it.
Where you use it
- Web: Lease > Leasing > Leases > Leases, Reviews and Breaks tab; Rentals > Configuration > Prices > Price Indexes
What you control
Settings
- Rent Review: No Review to start with
- Review every: 12 months to start with
- Read Months Back: 3 to start with
- At Least / At Most: 0 (no floor, no cap) to start with
Notifications
- No message is sent when the rent changes: the new rent appears on the next bill
Questions
Can the rent rise by CPI with a 3 % floor and a 6 % cap?
Yes. Choose By an Index, pick your CPI index, and set At Least 3 and At Most 6. Each review uses the figure from Read Months Back before the review date.Where do the index figures come from?
You enter them, one value per month, under Price Indexes. There is no automatic feed of published figures.Does the tenant get a letter about the increase?
Not by itself. The new rent shows on the tenant's coming bills and on the next bill. Send a notice to tenants if you want to tell them in writing.Is the review rent different at renewal?
A renewal sets its own New Rent. Rent reviews apply during the term of each lease.Related features
LEASES AND RENTRent schedule in advance or arrears, with rent-free monthsA confirmed lease bills itself from a schedule: monthly, quarterly, half-yearly or yearly, in advance or in arrears. Part periods go by the calendar, and stepped rents, rent-free periods and holdover worked in.LEASES AND RENTRenewals, breaks, holdover and notices to vacateRenew a lease with a new term and rent, and offer it to the tenant on their page. Let the new lease take over on its first day. Break options, holdover rent and notices to vacate each have their dates.LEASES AND RENTLeases with joint tenants, guarantors and several unitsA lease holds the tenant, joint tenants, occupants, guarantors, one or more units, the term, the rent and how it is paid. Confirm it and the rent schedule, the deposit and the unit statuses follow.REPORTS AND AIAsking-rent and renewal-rent hintsEach day SmartMy Lease suggests a new asking rent for empty units priced away from the market. It also suggests a rent for leases ending in the next 90 days. You apply a hint with one click; nothing changes by itself.COMMERCIALWALE, passing rent against market rent, and reversionEach property shows its weighted average lease expiry by rent and by area. It sets passing rent against market rent, and shows the reversion between them.
See your buildings on it.
Tell us how many properties and units you have, whether you let your own or manage for owners, and how rent is paid today. We will set up your portfolio with you on SmartMy Lease.