Good summary of new Rent Review rules

Discussion in 'Property investment and tenants' rights' started by Sarenco, Jan 4, 2017.

  1. Sarenco

    Sarenco Frequent Poster

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  2. Meath Lady

    Meath Lady Frequent Poster

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    A great summary Sarenco. Thanks.
    Wondering though if a tenant moved in in Sept 2015 and leaves when second year lease expires in Sept 2017. he has had no rent increase in that time in line with legislation. A new tenant takes a lease from 1st Oct 2017. Can I increase rent at the commencement of tenancy or must I advertise at existing rent ( I see I must advise tenant of existing rent) and give 90 days notice of increase to new tenant. Any thoughts on this or did I miss it whilst reading above.
    Another thought what if there are no comparable dwellings in the last four weeks when doing the rent review. This is probably more applicable in a rural area but i see you are still obliged to give the tenant details of comparable dwellings.
     
  3. Sarenco

    Sarenco Frequent Poster

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    Hi Meath Lady

    If your rental property is outside a rent pressure zone, you can advertise for a new tenant at whatever rent you think your property will achieve.

    When advertising the property, you should take account of the fact that you won't be able to review the rent again for at least two years if your new tenant stays put and there is at least a possibility that the area may subsequently be declared a rent pressure zone (in which case future rent increases will be capped).

    In short - don't rent the property at anything less than the absolute maximum amount you think the market can bear.
     
  4. Meath Lady

    Meath Lady Frequent Poster

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    Hi Sarenco,

    These are two different scenarios . One property outside the rent pressure area currently, with last rent review which was nominal in May 2015 and now well below the rent thresholds for the area but comparable properties very seldom advertised and quite lightly tenants will stay for another year or two or maybe more. Would not really wish to increase rent too much as am very happy with tenants but feel we will have to give 90 days notice of substantial increase in May 2017 to keep in line with others and because it lightly will become a rent pressure area, ( maybe even before May 2017).

    Other property had a new lease and new tenants in Sept 2015 and no rent increase since in line with legislation. It is lightly they will move out in September 2017 or give notice and leave prior to that.
    This property is in a rent pressure zone. When tenant moves out assuming Sept 2017 what happens. I re advertise at the current rent and give new tenant 90 days notice or can I re advertise at an increased rent provided I demonstrate other properties in the area are charging similar.
     
  5. Sarenco

    Sarenco Frequent Poster

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    Ah, gotcha.

    In the first scenario, you would be well advised to review the rent this coming May and to notify your tenant (90 days' notice required) of whatever you think is the maximum rent the market will bear (assuming the area hasn't been declared a "rent pressure zone" in the meantime).

    You only have to give examples of three "comparable" rentals having regard for the "size, type and character" of similar dwellings in a comparable area. There is no requirement that the comparators are in the same immediate area (or even the same county). Your tenants can appeal the amount of the rent increase to the RTB within 28 days of receipt of a valid notice but you are better off putting your best foot forward.

    In the second scenario, I'm afraid the law now provides that you can only charge a new tenant the rent that is currently being achieved on the property plus 4% (absent a "substantial change" in the accommodation provided) - no notice is required. You can advertise the property to let for whatever rent you see fit.

    As an aside, I find it truly depressing that adults are restricted by our Government from entering into bargains with each other on whatever terms they consider appropriate but the reality is that the new rules hammer landlords that tried "to do the right thing" by their tenants. Oh well...:(
     
  6. Meath Lady

    Meath Lady Frequent Poster

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    Thanks Sarenco. I agree the Government is now causing problems for good tenants by not taking consideration of landlords trying to do the right thing. They obviously did not think it through or consider all landlords greedy.
     
  7. Coobee1

    Coobee1 New Member

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    Hi we issued our tenant 90 day notice of rent review one month before new legislation came in (pressure zone). Will we get the original rent increase or do we now fall within the remit of the act? Thanks
     
  8. Gordon Gekko

    Gordon Gekko Frequent Poster

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    You're fine. I did the same.
     
  9. Coobee1

    Coobee1 New Member

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    Thanks Gordon
     
  10. Dan Murray

    Dan Murray Frequent Poster

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    Last edited: Jan 6, 2017
    Thanks for posting, Sarenco

    I agree that it's a good summary. Incidentally, I don't see where it addresses Coobee1's question or maybe I need stronger coffee! (Presumably, Gordon has verified it elsewhere.)

    Where I have issue with the PTRB is where they say......

    Supply

    It’s envisaged the new system will not negatively impact either existing or new supply


    Is this for real?:confused:
     
    Last edited: Jan 6, 2017
  11. sublime1

    sublime1 Frequent Poster

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    Would appreciate some urgent guidance as I'm planning on renting my place (Dublin) this week! Here's the situation:
    Current tenants moved in Jan 2015
    In Nov 2016, they gave me notice that they would move out in Jan 2017.
    I will be advertising the property next week once they move out.

    What rent can I set? The previous tenants amout plus 4%? Or whatever I like?
     
  12. Singer

    Singer Registered User

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    So many variables and hoops to jump through for investors now.
    You cant even have a spelling mistake or a date out by one day when giving notice to increase rent or you will be told that that notice in invalid, try again in another two years and keep the rent the same until then.

    I note from the RTB summary too that if you have a tenant less than 2 years now, that if you dont increase your rent for 4 years then the max you can increase it after 4 years is 10%. But if you increase it at 2, then 3 and then 4 years the max you can gain is 12%. Yet another incentive for landlords

    Picture two identical properties for sale next door to each other. One is a private residence, One is rented. If you cant sell with vacant possession you will not be selling to a private buyer. The only person who will be interested in the rental is an investor (of which there wont be too many).
    Also this brings down the price of the owner occupied one next door too. So if you live next door to a rented property prepare to have your property devalued.

    We've decided to sell. We're out, for the reasons I posted on AAM previously. Down to the new rules and the very likely imposition of even tighter rules without notice, which may have you unable to ever sell without the tenants.
     
  13. Purple

    Purple Frequent Poster

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    My Landlord cut my rent 2 years ago, about 6 months before the rent freeze. He said it was because I was an excellent tenant and he wanted me to stay. If he increases it now it will still be less than it was 2.5 years ago. That doesn't seem fair. That said he's not talking about it and I have done a considerable amount of work on the house for free.
     
  14. Thirsty

    Thirsty Frequent Poster

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    It's not really 'free' - Tenants improvements are taxable on Landlord by Revenue (assuming they get wind of it).
     
  15. LL????

    LL???? New Member

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    Currently own a property in a non Rent Pressure Zone area that is likely to become one soon.

    Last rent increase was in June 1st 2015 at less than going market rate at the time as the tenant is long standing and didn't want to lose them.

    Can I give notice of upcoming increase 90 days before its due or does it have to be 90 days notice from June 1st 2017?

    In either eventuality if the area becomes a designated Rent Pressure Zone during this 90 day notice period does the rent advised in the notice apply or will it be the current rent +4%?
     
  16. Gordon Gekko

    Gordon Gekko Frequent Poster

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    My understanding is that you can legitimately give them notice of a rent increase on 2 March (i.e. circa 6 weeks from now), and if the area becomes designated a Pressure Zone during the 90 day period, the increase still stands.

    You should increase the rent with a view to preserving the vamue of your property.
     
  17. Sarenco

    Sarenco Frequent Poster

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    Well, you can only review the rent 24 months after the last rent review (not when the last increase took effect) and you have to give 90 days notice of any further increase from that date.

    It is probably the case that a rent increase notice issued prior to the determination of an area as a rent pressure zone would remain valid but it's not 100% clear.
     
  18. LL????

    LL???? New Member

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    Seems harsh to be unable to increase rent for circa 27 months (24 months plus 3 months notice).
    Under previous rules you could give 56 days notice prior to the 12 month term finishing.