Former tenant threatening legal action

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Merv123

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New rent restriction rules meant my tenant was renting my property at 60% of market rate. He’d been there for years and I was foolish enough to keep the rent low as he was a good tenant; looked after the place, paid on time etc.

Thanks to the introduction of the rent increase restrictions, I decided to put the property up for sale and served adequate notice on the tenant. He was less than pleased about this.

When he left he told me if I didn’t follow through with the sale (ie. re-let to another tenant at a higher rent), he would report me to the RTB and take me to court. (Apparently, his father is a solicitor.)

Anyway, the property has been vacant and on the market for two months now. I’ve had a couple of offers (including one from the tenant) but nothing near what I would like to sell it for (it's barely out of negative equity).

I’m struggling to cover the mortgage with no rental income. Rents in the area are good and there is no shortage of prospective tenants. I know I can’t just re-let it without renovating so even though it’s already in good condition, I plan to renovate and re-let it at market rate. I’ve asked the RTB how much I need to spend and they said It’s up to me but it must add value to the property. My budget is about €2K.

I have no doubt my former tenant (via his father) will come after me for anything he can get so I want to make sure I am covered when he does. Can anyone tell me the best way to do this?
 
Interesting feedback from the PRTB!

The legislation uses the term "substantial" which seems at odds with what they're saying.

You are a bona fide seller so have nothing to worry about. If it was me, I would take tenants in on a 3 month basis.
 
Gordon is spot on - if you can prove that you had a bona fide intention to sell the property when you swore the requisite statutory declaration that accompanied the termination notice then you really have nothing to worry about.

You should obviously keep copies of any advertisements and any written offers recieved (which I assume were lower than your advertised asking price).

I would definitely allow three clear months from termination of the tenancy to pass before putting the property back on the letting market (assuming you don't agree a sale price in the interim).

You might find the report on an RTB decision at end of this thread of interest -
https://www.askaboutmoney.com/threads/landlord-backing-out-of-sale-after-eviction.203798/

I would be surprised if a €2k spend substantially increased the market value of the tenancy but this is very definitely a grey area. Definitely keep all receipts.

As an aside, I think it's a crying shame that a perfectly good landlord/tenant relationship has been destroyed by the RPZ regime. A truly stupid law.
 
Thank you both for your responses. I agree that I should leave it on the market for another month. Can I start the renovations while the property is still on the market? I'd like to let it as soon as possible after the three months expire.
 
€2k is nowhere near "substantial" or anything else, a lick of paint would cost that. I would think your previous tenant (having also bid on the house, so knows at least 1 bid you've refused) will keep at this, and rightfully so in my opinion.
 
I presume you can include the cost of work you did yourself on the upgrade of the property when stating how much you spent on refurb. You don't need to let the tenant in to look at the refurb either so avoid that at all costs. Maybe suggest to your ex tenant you will give him a short term lease for now ? If however, as it seems, he is intent on sticking to his guns it would be best to get shut of him. (Thinking out loud on both sides here)
 
Your last tenant has threatened you with legal action. You most certainly do not want to let to him again if you can avoid it. Hopefully he has let somewhere else and is under a 1 year contract.
Do not show your x tenant the refurb as Elcato has said. Do not advertise the property on Daft showing the new photos of the refurb. Rental properties are in such high demand you should be able to rent it without daft.
Question...... once you register your new tenants can your x tenants access information on the rent you are charging through the PRTB? Could they simply phone up the PRTB and request the current rent expressing their suspicion that they have been kicked out to allow a rent increase? Are the PRTB legally allowed to give out this info?
 
The gist of the post in the link sarenco posted is that there was a PRTB case recently where notice had been given due to intention to sell. It had then been relet on a shorter lease. The owner's argument was that he could not sell with a long term sitting client, but could sell with a short term client with a significantly shorter notice period. The PRTB found in the owner's favour. This sounds very much like the scenario you would be in without doing any renovations.

Of course, without any improvements, you wouldn't be able to increase the rent by more than 4%.
 
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dereko1969 said:
€2k is nowhere near "substantial" or anything else, a lick of paint would cost that. I would think your previous tenant (having also bid on the house, so knows at least 1 bid you've refused) will keep at this, and rightfully so in my opinion.
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Whether or not a €2k spend substantially alters the value of the tenancy has nothing to do with the OP's previous tenant - that wasn't the ground upon which the tenancy was terminated.

The previous tenant would have to demonstrate that the notice of termination was invalid as the OP lacked a good faith intention to sell the property at the time that he swore the requisite statutory declaration.
 
I think the OP should have a rethink about their next move because when I read their first post I don't see it like the other posters

"I have a a property that is let to a very good tennent at 60% of market rate, I'm not happy about this as I can't raise the rent to full market rate because the new rules wont let me.
So I gave the tenant notice and put the property on the market for sale but now 2 months have passed and I'm not getting the price I want for the property so I'm going to rent it again
But now I'm going to charge the full market rate because I'm going to do renovations that will only cost me €2000"

I think the former tenant would have a fairly good case against their former landlord and my advise would be for the Op to have a rethink and get proper advise about the position that they have put themselves in.
 
OP, this sounds like a disaster. Would you not consider Airbnb for a year or so? I presume you previous tenant will have moved on by then?
 
Sarenco said:
I included a link to the report in post #3 above! :)
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You're too fast. I thought I'd seen it on boards, and then looked at your link and realised I'm an idiot. I went back and edited it in the hopes that my stupidity would remain hidden, but you got there first.
 
landlord said:
Question...... once you register your new tenants can your x tenants access information on the rent you are charging through the PRTB? Could they simply phone up the PRTB and request the current rent expressing their suspicion that they have been kicked out to allow a rent increase? Are the PRTB legally allowed to give out this info?
Click to expand...

No, that is not publicly available information and it would be unlawful for the RTB to disclose this information.

Threshold has been calling for such a rent register but the Department of Housing has poured cold water over the idea -

https://www.irishtimes.com/news/ire...register-to-stop-hikes-by-landlords-1.3200057
 
If you received a bid for the property reflecting its market value and didn't sell, then you will have a hard time going to the PRTB claiming a genuine intention to sell?

If you can show you had the property listed for a period of X duration, at a price reflecting its market value, and did not receive any bids comparable to its market value, then you have a pretty clear cut defence for any complaint.
 
I didn't use an agent to advertise the property. Instead, I advertised it myself on daft. Would that go against me if there was a dispute in the future?
 
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My sense is that there are landlords who tell the tenant that the property is being sold and then simply re-rent the property and completely flout the rules.

Someone who has formally listed the property for sale and left it vacant for a reasonable period of time should have nothing to fear.
 
Merv123 said:
I didn't use an agent to advertise the property. Instead, I advertised it myself on daft. Would that go against me if there was a dispute in the future?
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No, that wouldn't be relevant.

Was your advertised asking price fairly realistic? In other words, is there anything your previous tenant could point to that would suggest that you did not genuinely intend to sell?
 
Gordon Gekko said:
My sense is that there are landlords who tell the tenant that the property is being sold and then simply re-rent the property and completely flout the rules.

Someone who has formally listed the property for sale and left it vacant for a reasonable period of time should have nothing to fear.
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So in this situation, what would be considered a "reasonable period of time" and what would be considered "substantial renovations" in the eyes of the PRTB ??
 
Cervelo said:
So in this situation, what would be considered a "reasonable period of time" and what would be considered "substantial renovations" in the eyes of the PRTB ??
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Well the PRTB (or to be specific, someone manning the phones in the PRTB) suggests anything that increases the value of the property. Personally, I wouldn't rely on that, and would look to the ordinary meaning of the word "substantial"; that would make me conclude that something like a new kitchen, new bathroom, or BER upgrade would be required.

In terms of periods of time, again it's subjective as there's no objective test. My own view is that 3 months (i.e. a quarter) is probably about right, whereas a week/fortnight/month wouldn't look right optics-wise.
 
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