Is it time for private landlord to exit the rental market in RPZs?
Like a lot of landlords we recently underwent a ‘notice of rent review’ in accordance with the RTB RPZ calculator. In addition to the RTB RPZ maximum cap on any rent increase, which we have endured for the last 7 years, what’s even more disappointing is the difference between the increased rent and the details of the ‘comparable dwellings', our rent is presently between 34% and 43% below comparable market rent.
Any increase in rent is taxed so the landlord receives approximately 50 % of the increase, so for a 2% cap dictated by the RTB in RPZ, the average landlord receives 1%. This means the rent increase received under the RPZ does not keep pace with inflation. We have reviewed our rental statements for the last 5 years and the increase in rent is about 7.5 % or 1.5% average per year, that is before tax. Added to that is the maintenance costs have also increased dramatically, the increased rent does not cover the annual maintenance costs. The consequences are that we will have no choice but to terminate a tenancy as it is now financially unviable to be a private landlord in a RPZ.
Without increasing the rent for the tenant, we could have managed financially if we had received a tax credit for the difference between the market rent of comparable dwellings contained in the notice of rent review and our present rent which is 34% and 43% below comparable market rent. This would remove the 2 tier system of market rent and below market rent between landlords in the same rent area. In addition it would have incentivised us to remain and maybe even invest in the private rental market in a RPZ.
The recent articles and publications from the RTB etc are no more than political football between parties and box ticking exercises, the data they quote bears no resemblance to what we as average landlords are experiencing, between 34% and 43% below market rent and an average annual increase of 1.5% in rent before tax.
Is it time for private landlords to exit the RTB RPZ rental market because the restrictions are so severe and the proposed budget 2024 tax relief for small landlords is just a box ticking exercise to appease the opposition?
Like a lot of landlords we recently underwent a ‘notice of rent review’ in accordance with the RTB RPZ calculator. In addition to the RTB RPZ maximum cap on any rent increase, which we have endured for the last 7 years, what’s even more disappointing is the difference between the increased rent and the details of the ‘comparable dwellings', our rent is presently between 34% and 43% below comparable market rent.
Any increase in rent is taxed so the landlord receives approximately 50 % of the increase, so for a 2% cap dictated by the RTB in RPZ, the average landlord receives 1%. This means the rent increase received under the RPZ does not keep pace with inflation. We have reviewed our rental statements for the last 5 years and the increase in rent is about 7.5 % or 1.5% average per year, that is before tax. Added to that is the maintenance costs have also increased dramatically, the increased rent does not cover the annual maintenance costs. The consequences are that we will have no choice but to terminate a tenancy as it is now financially unviable to be a private landlord in a RPZ.
Without increasing the rent for the tenant, we could have managed financially if we had received a tax credit for the difference between the market rent of comparable dwellings contained in the notice of rent review and our present rent which is 34% and 43% below comparable market rent. This would remove the 2 tier system of market rent and below market rent between landlords in the same rent area. In addition it would have incentivised us to remain and maybe even invest in the private rental market in a RPZ.
The recent articles and publications from the RTB etc are no more than political football between parties and box ticking exercises, the data they quote bears no resemblance to what we as average landlords are experiencing, between 34% and 43% below market rent and an average annual increase of 1.5% in rent before tax.
Is it time for private landlords to exit the RTB RPZ rental market because the restrictions are so severe and the proposed budget 2024 tax relief for small landlords is just a box ticking exercise to appease the opposition?
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