How do the new rent controls affect selling and buying a rental property?

Discussion in 'Property investment and tenants' rights' started by Brendan Burgess, Dec 16, 2016.

  1. T McGibney

    T McGibney Frequent Poster

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    If legal, why not? Property owners are entitled to maximise the return on their assets.
     
  2. Bronte

    Bronte Frequent Poster

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    But you can't just kick out tenants for this reason. She's not genuinely going to live there. That exemption is for cases where landlords decide to move back into their properties.
     
  3. T McGibney

    T McGibney Frequent Poster

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    Which she's doing.
     
  4. Bronte

    Bronte Frequent Poster

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    I don't consider someone moving back in for a week and then making a bnb out of it to be anything other than playing the system. But I guess the system doens't have a length of time of how long you move back in for.

    Citizen's advice:

    If the landlord needs the property for their own use or for an immediate family member, you must be given the following information in writing, along with the notice of termination: the person’s name; their relationship to the landlord; and how long they will occupy the dwelling. The notice must also include a statutory declaration stating that the landlord needs the property for their own use or for an immediate family member

    Redress
    Under section 56 of the 2004 Act, you can complain to the RTB in the following situations:

    • If your landlord has ended your tenancy for one of the 3 reasons specified above, the property becomes available for re-letting and they do not offer you a tenancy
    • If they did not carry out the intention stated in the notice of termination – either one of the above 3 reasons or sale of the property
    If the RTB upholds your complaint, it may direct the landlord to pay you damages or to reinstate your tenancy, or both.
     
  5. T McGibney

    T McGibney Frequent Poster

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    She never mentioned moving in for a week. If she has to move in for 3 years, it's still a rational decision and she's well entitled to protect her interests by doing so.
     
  6. Bronte

    Bronte Frequent Poster

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    She never said for a week, but she did ask how short a time does she need to live there. I agree that if she moves in for 3 years she'll be grand. But she could get caught under section 26 if the tenant finds out she moved out again after a month.
     
  7. T McGibney

    T McGibney Frequent Poster

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    You condemned her idea by saying

    without enquiring from her what timeframe she was proposing. If she lives in the property for the minimum period permissible, she's okay regardless of whether that minimum period is a short or long time.
     
  8. Bronte

    Bronte Frequent Poster

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    I still don't think it's correct behaviour and the it seems to me the PRTB would throw the book at her. You can't evict someone because you want to change business. Which is what she is at. I don't see any reason for her not to change the business as long as she complies with the rules on evicting tenants.
     
  9. T McGibney

    T McGibney Frequent Poster

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    You can though, if you live there first.
     
  10. Gordon Gekko

    Gordon Gekko Frequent Poster

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    It's amazing how the rights of (often) transient tenants are suddenly trumping the rights of people who actually own the asset.

    It's also gas how everyone wants wages at 2007 levels but not rents.

    Landlords are being rogered with this ridiculous populist legislation. I have always been overly generous to my tenants. My reward? Getting shafted. It's now all about protecting my position and maximising returns.
     
    Freshstart, Dermot, jprender and 2 others like this.
  11. Sarenco

    Sarenco Frequent Poster

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    The RTB does indeed have that information (at least for registered tenancies) but a purchaser of a property can't access the information - it's not publicly available.

    So how can a purchaser ensure he is compliant? It's impossible.
     
  12. dubliner2k15

    dubliner2k15 New Member

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    The law has a provision in that, if the existing rent results in the market value of the property being undervalued by more than 20% than you are allowed to evict the tenants. The RTB has to decide this. But if the RTB is as 'efficient' as they usually are you could be looking at waiting 6-12 months for them to decide this, probably a lot longer. I think it is rather disturbing that the state acknowledges in this law, that rent caps will undervalue property and they are comfortable with this as long as it is only undervaluing the property by up to 20%.

    The biggest change with the new rental laws is tenancies duration. When you hear people banging on about how Ireland doesn't offer long term renting as a viable option, they are generally incorrect. Tenancies used work in 4 year period. If you rent a property and lived there for 6 months or more, by law you were entitled to part IV rights which meant you were allowed to reside in the property for 4 years. So if you had a year long lease, you could live there for another 3 years. After the 4 years, your landlord could evict you.

    A lot of landlord were burned with bad tenants who initially got a year long lease and used part IV rights to stay there for another 3 years. So a lot of landlords were giving 5 month leases. So after the 5 months you could evict a bad tenant and not be stuck with them for 4 years. You didn't have to give a reason for eviction within 6 months of a tenancy.

    The Government has changed this completely with the new laws and most people don't realise this. All new tenancies had part IV changed to 6 years. The Government has abolished the right to evict tenants within the first 6 months with no reason and you can no longer evict tenants after the 4 years (now 6 years without reasons). So basically the Government has decided that tenants can basically indefinitely reside in a rental property.
     
  13. Gordon Gekko

    Gordon Gekko Frequent Poster

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    How will that work? (the 20% reduction in value / eviction piece)

    Can you set out a theoretical example?

    Many thanks.
     
  14. Thirsty

    Thirsty Frequent Poster

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  15. Sarenco

    Sarenco Frequent Poster

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    That provision only relates to the so-called ‘Tyrrelstown Amendment’, i.e. where a landlord proposes to sell 20 or more units within a single development, at the same time, the sale will be subject to the existing tenants remaining in situ, other than in exceptional circumstances. It's not relevant to most private landlords.
     
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  16. gar32

    gar32 Frequent Poster

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  17. Sarenco

    Sarenco Frequent Poster

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    The whole process has become ridiculously complicated but I'm pretty sure the situation is as follows:-

    Assuming it was a one-year lease and the tenants decide to stay put, you can't review the rent before March 2018. Then you have to give 90 days' notice of the increased rent before it takes effect (bringing you to June 2018) and any increase is subject to the new 4% cap, where applicable.

    Thereafter, you can review the rent on an annual basis (subject to the 4% cap for as long as it lasts), giving 90 days' notice each time.
     
  18. gar32

    gar32 Frequent Poster

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    The tenants will be starting their 3rd year so Can I not review the rent during the following months or does it have to be on renewal of contract ?
     
  19. Sarenco

    Sarenco Frequent Poster

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    It doesn't really matter when the tenancy started or when any fixed-term contract is renewed - it really turns on when the rent was last reviewed.

    Currently a rent review can only be carried out every two years. So, if you last reviewed the rent in March 2016, the next time you can review the rent is March 2018 (and that is subject to the 4% cap if applicable) and you have to give your tenants 90 days' notice of any change following the review.

    If you hadn't reviewed the rent in over 2 years, then you could have issued a 90-day notice before Christmas to avoid the 4% cap. Too late now I'm afraid.
     
  20. Dermot

    Dermot Frequent Poster

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    I am confused by above as I thought that while you could raise the rent subject to the 4% annual cap that this could only be done every two years. ie 8% with 90 days notice every two years. I am only asking the questions in order to learn.

    It would be great if someone could start a thread that would put together all the changes that are in the legislation and then do a comprehensive summary of it in lay terms following contributions from all the knowledgeable posters that are out there