Rent Rise Negotiation

wicklowwonder

Came home this evening, living in a one bed apartment, Dublin city centre, to a letter telling me my rent was increasing by 12.5% from April... less than happy. 12.5% is a big increase, the letter says it is moving the rent in line with current market rates.

Lived here 18 months, six months out of a year long contract so not covered by a letting agreement. Not sure what to do, girlfriend is keen to stay as its a nice gaff, I wouldn't mind moving as I feel for an 15%-20% increase we could a nice two bed.

Definitely going to negotiate with him, how much do you think the landlord will drop to? Ideally I wouldn't mind paying a 3% increase and the Daft report today says rent increased by 2.2% Q4 2012. Any thoughts guys?

CrinkElite

That's nasty. I'd start looking for a new place in any case, just so you know what your hand looks like before you get into negotiations.

You might be able to get the girlfriend on side if ye find something nice.

Cheeky bastards!

TheBandicoot

I don't think he can raise the rent, he is only allowed to do so once a year so his opportunity was 6 months ago when you transitioned to a part 4. Tell him to get stuffed(although realistically he has all the cards, in the current market he can replace you in about a day of advertising).

PS where is the apartment? I might take it.

wicklowwonder

TheBandicoot wrote: »

I don't think he can raise the rent, he is only allowed to do so once a year so his opportunity was 6 months ago when you transitioned to a part 4. Tell him to get stuffed(although realistically he has all the cards, in the current market he can replace you in about a day of advertising).

Nah fairly sure he can raise it once in a 12 month period. So if he raises it in April 2013 can't raise it again till April 2014 which hopefully if all pans out we will be moving out as we are hoping to buy in Q1 2014 - fingers crossed, touch wood etc.

Thanks for the help though.

djimi

TheBandicoot wrote: »

I don't think he can raise the rent, he is only allowed to do so once a year so his opportunity was 6 months ago when you transitioned to a part 4. Tell him to get stuffed(although realistically he has all the cards, in the current market he can replace you in about a day of advertising).

PS where is the apartment? I might take it.

He can raise the rent once in a 12 month period. It doesnt have to be at 12 months exactly.

OP 12.5% seems an awful lot, unless you were paying well below market rate to start with. Even then Id be arguing that it should be more gradual than that. You would be well advised to get onto Daft and make a note of the asking price of every similar property in your area. Depending on where you are, the actual rental price might be somewhat lower than that (although Id imagine a lot of areas of Dublin are currently getting the asking price). This will give you a better guide as to where you stand.

Its worth bearing in mind that if you wish to dispute the rental increase with the PRTB you are entitled to do so, and you are legally entitled to continue paying your current rate until the case is heard. Under a part 4 tenancy the landlord has no grounds to evict you if you choose to contest this increase, so keep this as an option for yourself if the landlord is sticking to their guns.

TheBandicoot

Sorry, yeah, I think you're right, the relevant law is here at http://www.irishstatutebook.ie/2004/en/act/pub/0027/sec0020.html
So yeah, he can set a new rent at this juncture. Oh well.

wicklowwonder

djimi wrote: »

He can raise the rent once in a 12 month period. It doesnt have to be at 12 months exactly.

OP 12.5% seems an awful lot, unless you were paying well below market rate to start with. Even then Id be arguing that it should be more gradual than that. You would be well advised to get onto Daft and make a note of the asking price of every similar property in your area. Depending on where you are, the actual rental price might be somewhat lower than that (although Id imagine a lot of areas of Dublin are currently getting the asking price). This will give you a better guide as to where you stand.

Its worth bearing in mind that if you wish to dispute the rental increase with the PRTB you are entitled to do so, and you are legally entitled to continue paying your current rate until the case is heard. Under a part 4 tenancy the landlord has no grounds to evict you if you choose to contest this increase, so keep this as an option for yourself if the landlord is sticking to their guns.

Having a look at daft. 5% - 6.25% increase would be asking price for similar apartments in out area. Think I will offer to pay a 3% increase, willing to rise a little. Thing is he has never had any bother with us as tenants, washing machine broke once and a few running repairs but nothing out of the ordinary and always pay rent on time so surely that has to be worth something?

How long would a PRTB case take to get heard? Weeks or months? How much does it cost to file?

djimi

wicklowwonder wrote: »

Having a look at daft. 5% - 6.25% increase would be asking price for similar apartments in out area. Think I will offer to pay a 3% increase, willing to rise a little. Thing is he has never had any bother with us as tenants, washing machine broke once and a few running repairs but nothing out of the ordinary and always pay rent on time so surely that has to be worth something?

How long would a PRTB case take to get heard? Weeks or months? How much does it cost to file?

Costs €25, usually takes months to resolve (not sure about rent increase disputes though).

How likely is the place to get rented quickly if you were to leave? The landlord will have to take this into account; one month sitting vacant is likely to cost them more than they will make from their rent increase for a year. Plus they will have to go through the hassle of having to replace you and hoping that they can find a decent tenant. A lot will not be prepared to take that risk for the sake of a couple of hundred quid extra a year.

wicklowwonder

djimi wrote: »

Costs €25, usually takes months to resolve (not sure about rent increase disputes though).

How likely is the place to get rented quickly if you were to leave? The landlord will have to take this into account; one month sitting vacant is likely to cost them more than they will make from their rent increase for a year. Plus they will have to go through the hassle of having to replace you and hoping that they can find a decent tenant. A lot will not be prepared to take that risk for the sake of a couple of hundred quid extra a year.

Offered to take a 3% rise see what comes back tomorrow. Won't be afraid to threaten going to PRTB if things don't go well.

Can PRTB back date their decision I wonder if they where to rule against me?

hfallada

Dublin city had a 6% increase. But there is a shortage of apartments in the city. Which I think will get worse as there is a huge increase in English language students in the last year or 2.

Would you ask him for say a 8 % but sign a 2 year agreement. Since you said its a nice apartment plus it will protect you from further increases in the future

wicklowwonder

hfallada wrote: »

Dublin city had a 6% increase. But there is a shortage of apartments in the city. Which I think will get worse as there is a huge increase in English language students in the last year or 2.

Would you ask him for say a 8 % but sign a 2 year agreement. Since you said its a nice apartment plus it will protect you from further increases in the future

That won't be happening, as I mentioned we hopefully will be in a position to buy next year. A 12.5% increase will slow down our savings rate mind! I understand the landlord has extra bills to pay this year etc. and has to make money, I am all for capitalism that's why I offered him a 3% rise, let's see how much he values me as a tenant and how much he values the time he may waste finding another tenant. 3% rise will see him earn a fair few hundred euro extra in the next twelve months. Don't want to go down PRTB route but will threaten it as well if he holds firm on 12.5%,

littleredspot

It's a very foolish/greedy landlord who would turf out a good tenant for 12.5% extra.

That said, prices have def gone up in the city center, but possibly more importantly, it's got really hard to actually get a place. You'll almost certainly need good references from your current landlord too.

wicklowwonder

littleredspot wrote: »

It's a very foolish/greedy landlord who would turf out a good tenant for 12.5% extra.

That said, prices have def gone up in the city center, but possibly more importantly, it's got really hard to actually get a place. You'll almost certainly need good references from your current landlord too.

I understand that and probably 5% increase is in line with market value as per similar properties on daft at tge moment but I am offering 3% as I am a good tenant who has an 18 month trouble free relationship with land lord so lets see how this goes.

12.5% is huge alright and I think he probably took into consideration I would negotiate, personally have a feeling he may be happy with 7/8% increase but I will definitely be looking around if he holds me to anything than 3%, I don't mind moving my gf isn't keen on moving but I if we find somewhere nice closer to her job she might be satisfied!

djimi

Even 7%/8% is a pretty sharp increase, and one Id say the landlord would have a lot of trouble justifying unless, as Ive said, you are paying far too little at present. I suspect they are struggling to break even with this rental and are looking to offset the shortfall by increasing the rent. You know better than we do how much the place is worth and how much you are prepared to pay, but if it were me I would be fighting anything more than about 5% increase in one year.

cson

Mediate this as far as you can; going into any negotiation with good dialogue with the landlord will always yield better results. Don't go in gung ho with PRTB threats.

D3PO

so you acknowledge your paying about 6% below the market rate yet are saying you will look elsewhere if he doesnt accept 3 ...

you need to look long and hard at the landscape of rentals currently in the city centre, by all means negotiate but threatening to leave if you arent left with a below market rate rent is not the best move ever id venture to say.

as for the PRTB query if they find against your dispute yes you will be libel to pay backdated rent based on their determination and also potential costs. I think going this route is not a good move tbh.

hardmaneddie

That is a very poor way to treat you as you seem like a decent tenant and the landlord should be glad to have you. It would be better to move and just not pay any more, if you pay the rent by yourself then the decision is yours, why should you loose money? No point wasting it.

wicklowwonder wrote: »

Came home this evening, living in a one bed apartment, Dublin city centre, to a letter telling me my rent was increasing by 12.5% from April... less than happy. 12.5% is a big increase, the letter says it is moving the rent in line with current market rates.

Lived here 18 months, six months out of a year long contract so not covered by a letting agreement. Not sure what to do, girlfriend is keen to stay as its a nice gaff, I wouldn't mind moving as I feel for an 15%-20% increase we could a nice two bed.

Definitely going to negotiate with him, how much do you think the landlord will drop to? Ideally I wouldn't mind paying a 3% increase and the Daft report today says rent increased by 2.2% Q4 2012. Any thoughts guys?

Lookingforward

Its basic old school top down negotiations. He wants a 6 percent rise so he threatens a 12 percent rise. after some negotiations you whittle him down to 6 and feel like a hero. he gets exactly what he wanted in the first place everybody wins.

Its no coincidence that the market increase is exactly half of what he wants. anything close to 6 percent and you have lost the negotiation:)

3 percent would be a good result.

wicklowwonder

Thanks for all the advice, I have dropped an email outlining my arguments and reluctantly offering to take a 3% increase. Rest assured please I haven't gone in threatening to leave or threatening the PRTB, these are way further down the tracks. I was using boards as the great tool it is to formulate a strategy on attacking this and gathering other opinions. It is great to know all the options available to a tenant and also have a structure in my head of how I plan to negotiate this. Thanks again for all the help and the PRTB or leaving option are definitely the "Go Nuclear" options, though I will be lining up some viewings tomorrow just to see what's out there.

I will keep you all updated.

wicklowwonder

wicklowwonder wrote: »

Thanks for all the advice, I have dropped an email outlining my arguments and reluctantly offering to take a 3% increase. Rest assured please I haven't gone in threatening to leave or threatening the PRTB, these are way further down the tracks. I was using boards as the great tool it is to formulate a strategy on attacking this and gathering other opinions. It is great to know all the options available to a tenant and also have a structure in my head of how I plan to negotiate this. Thanks again for all the help and the PRTB or leaving option are definitely the "Go Nuclear" options, though I will be lining up some viewings tomorrow just to see what's out there.

I will keep you all updated.

Just got a reply to my email I sent last week,

Hi X,

Landlord told me that he doesn’t want to negotiate on the Rent Price. That’s the new price effective from 5th of April as stated in the letter sent to you on 11/02/2013


Regards
Y

Not sure what to do now, think I will either have to move out, accept rent increase or go to PRTB. I tried to negotiate and he wasn't having any of it. Has anybody ever gone to the PRTB before on a case like this? I really don't want to move out as the location is ideal but I feel the landlord is totally out of touch here.

Any advice appreciated.

djimi

Get onto Threshold and see if they think you have a case. If they think its worth it then open a case with the PRTB, assuming you are prepared to go down that road with your landlord. Only you know whether or not this is something you feel is worth doing or that you are prepared to do.

The only other alternative that you have is to move out. Your landlord position suggests to me that they either know they will have no trouble renting the place out for the increased amount, or they are an utter moron who is prepared to lose a good tenant and possibly thousands of Euro for the sake of sticking to their guns. Again you probably know better than us which it is. Handing in your notice may call their bluff and force their hand, or you may end up having to move house.

Best of luck whichever way you choose.

wicklowwonder

djimi wrote: »

Get onto Threshold and see if they think you have a case. If they think its worth it then open a case with the PRTB, assuming you are prepared to go down that road with your landlord. Only you know whether or not this is something you feel is worth doing or that you are prepared to do.

The only other alternative that you have is to move out. Your landlord position suggests to me that they either know they will have no trouble renting the place out for the increased amount, or they are an utter moron who is prepared to lose a good tenant and possibly thousands of Euro for the sake of sticking to their guns. Again you probably know better than us which it is. Handing in your notice may call their bluff and force their hand, or you may end up having to move house.

Best of luck whichever way you choose.

Sent a mail to Threshold so see what comes back from them.

Ritchi

There is no need to let him know until one month before the date of increase. No point in needlessly giving him more time to replace you.

So if you don't decide to pay the rent, then let him know on the 5th March.

littleredspot

Ritchi wrote: »

There is no need to let him know until one month before the date of increase. No point in needlessly giving him more time to replace you.

So if you don't decide to pay the rent, then let him know on the 5th March.

Fairly sure it's legally 6 weeks http://www.citizensinformation.ie/en/housing/renting_a_home/types_of_tenancy.html

Op I think you have to carefully check exactly how much your place is worth. You say it's about 6% below market value currently. Unless you were paying way over the odds 18 months ago, I'd find that surprising.

D3PO

for me its pretty straight forward. you pay up or move out. Yes there is a process where you can dispute the rent but seriously what is the point ?

Worst case you lose, owe the backrent plus costs plus interest and you piss off your landlord to the point that all goodwill is goone

best case you win, your piss off your landlord to the point your tennany becomes untenable and he most likely uses rightly or wrongly one of the triggers under part 4 to get you out ( which your unlikely to be able to prove otherwise)

Ray Palmer

wicklowwonder wrote: »

Sent a mail to Threshold so see what comes back from them.

I would think the increase would be within the threhold of market rates. It is a very vague term but I would take it as 10% either side of the average rate for the location.

djimi

Ray Palmer wrote: »

I would think the increase would be within the threhold of market rates. It is a very vague term but I would take it as 10% either side of the average rate for the location.

Why would you think that? The OP has said that the average asking price for their area is about 5% more than they are paying, which most likely means they are paying exactly the same as most other tenants in similar properties.

12.5% increase is €125 a month increase on a €1000 a month property. Id say the landlord would have a hell of a job convincing anyone that that kind of increase is justified.

D3PO

djimi wrote: »

Why would you think that? The OP has said that the average asking price for their area is about 5% more than they are paying, which most likely means they are paying exactly the same as most other tenants in similar properties.

12.5% increase is €125 a month increase on a €1000 a month property. Id say the landlord would have a hell of a job convincing anyone that that kind of increase is justified.

I dont think they would. I think the OP said its actually 6% below what is being paid on average. Average being the key meaning some properties would be closer to what they are being asked to pay and some below.

there is no clear definition of what is the market rate but logic dictates the market rate as being what somebody is willing to pay. Clearly the landlord believes that there are persons willing to pay what he wants therfore by definition to me that is the market rate.

nobody is making the OP pay this. If its such an outrageous price for the area go get another rental in the same area .....

as for the €125 increase on a €1000 a month property. it could also be repesented as ain increase of €65 per month above the average €1060 property.

You can make it sound as extreme as you want. You always post damming landlords for not being professional and if they made a mistake their tough they should know better.

but now you argue on the otherhand against a landlord who seems to know his business and knows what he can achive on his rental. They should be professional and know their game i know you agree with this, therefore you have to accept that they should be best placed in knowing the market rate for rent.

djimi

D3PO wrote: »

You can make it sound as extreme as you want. You always post damming landlords for not being professional and if they made a mistake their tough they should know better.

but now you argue on the otherhand against a landlord who seems to know his business and knows what he can achive on his rental. They should be professional and know their game i know you agree with this, therefore you have to accept that they should be best placed in knowing the market rate for rent.

What makes you think that the landlord is doing anything other than chancing their arm? What leads you to believe that the increase they are trying to charge is justifiable? 12.5% increase is extreme in my book, especially as it appears that the OP is not paying much below the average price for their area, if at all (they state that they are paying about 5-6% below asking price, which for my area anyway is usually what property tends to rent for). Without knowing the exact area and the amounts in question it is only pure guesswork on our part, which is why I have suggested contacting Threshold who will listen to the full story, take note of the figures and give a proper opinion based on the facts that we do not have.

Really all I am saying is that the amount being asked for is high. I wouldnt accept being asked for such an increase, and I very much doubt that you or anyone else on this forum would accept it either without asking some serious questions first.

RATM

OP if the landlord was seeking a 12.5% increase counter-offering a 3% one was always unlikely to work- you probably should have went in at 6%. There is nothing to stop you still doing so while at the same time handing in your notice- a final take it or leave it offer.

If you're not willing to pay the 12.5% then you should be probably get looking for a new place soon, especially as there seems to be anecdotal evidence that city center properties are in big demand right now as more and more first time buyers remain sitting on the fence and continue to rent.

littleredspot

Ah go on, tell us where you live Op, I've Daft.ie open and ready to go...