Asking Flatmate for Rent Increase

Pawwed Rig

The_Morrigan wrote: »

Paww that makes it a b*tch to declare on your tax returns if you don't have a fixed sum every month.

I'm still looking into that. I haven't forgotten about it

In this case either way it will not make a difference as the rent he would be receiving would be well below the threshold.

ILikeFriday

I know the advice has been look at similar rates in the area, but is there really anywhere in Dublin where someone would pay 715 for a bedroom? I wouldn't, because you're getting into the lower end of studio/one bed flat rental rates at that stage and that would always be more valuable to me than a bedroom, even if it was a less nice property in a less nice area. I'd have my own space.

MagicMarker

ILikeFriday wrote: »

I know the advice has been look at similar rates in the area, but is there really anywhere in Dublin where someone would pay 715 for a bedroom? I wouldn't, because you're getting into the lower end of studio/one bed flat rental rates at that stage and that would always be more valuable to me than a bedroom, even if it was a less nice property in a less nice area. I'd have my own space.

715 includes bills.

ILikeFriday

MagicMarker wrote: »

715 includes bills.

It's still getting close to what you could have your own (albeit probably much less nice) property for. I would think, there has to be a good difference between the total cost of renting a bedroom and the total cost of renting a very small flat for someone to accept the price. Even at 100 euro difference per month, a person who could afford it, would probably start to think they could have their own place for just a little more per week.

I've had a quick look on daft and there are some flat shares in this region, but a lot of them are short term lets where you expect to pay a premium.

UCDVet

ILikeFriday wrote: »

I know the advice has been look at similar rates in the area, but is there really anywhere in Dublin where someone would pay 715 for a bedroom? I wouldn't, because you're getting into the lower end of studio/one bed flat rental rates at that stage and that would always be more valuable to me than a bedroom, even if it was a less nice property in a less nice area. I'd have my own space.

I'd say it depends on the area.

My wife and I were renting in D4, along the N-11 and paying ~955 per month for fairly run-down, ground-level, one bedroom flat.

Depending on how nice the place is, how much space is available and all that - 715 might be reasonable.

Tar.Aldarion

Indeed ILikeFriday, my whole apartment + bills wouldnt be much more than that, 15 mins walk to o'connell street in a small but nice apartment.

ILikeFriday

I'd be like you Tar.Aladrion. If I were paying in that region, I'd just go for my own place.

UCDVet, I suppose I don't disagree with you that some people might find it reasonable. Maybe what I should have said is that I think the market of potential tenants would be greatly reduced. It's probably a personality thing, but I would place a high premium on having my own space. Others might value the space/style/location of the apartment more.

suicide_circus

Tar.Aldarion wrote: »

Indeed ILikeFriday, my whole apartment + bills wouldnt be much more than that, 15 mins walk to o'connell street in a small but nice apartment.

sounds good, can i ask the area your apt is in? I'm in the market...

Tar.Aldarion

Between phibsboro shopping centre and town. Nice around there, you have some parks, canals etc. Also phoenix park and botanical gardens aren't too far off.

quietsailor

The_Morrigan wrote: »

Paww that makes it a b*tch to declare on your tax returns if you don't have a fixed sum every month.

as long as the total monies taken in are less than €10,000 it won't matter as the revenue won't assess on it.

The_Morrigan

quietsailor wrote: »

as long as the total monies taken in are less than €10,000 it won't matter as the revenue won't assess on it.

You still have to declare it honestly, not just pick a random figure out of the sky below the threshold.

matrim

The_Morrigan wrote: »

Paww that makes it a b*tch to declare on your tax returns if you don't have a fixed sum every month.

I'm confused how it would affect his tax every month. He would still be getting a fixed rate rent every month and the bills would be separate and I assume not subject to other tax as they are paying for a utility not the rent.

ebixa82

GusherING wrote: »

Howdy.

I'm an owner occupier of a 2 bed apartment in D4. I've owned the place about five years and have always had a live in tenant. My current tenant is with me almost three years and our agreeement comes up for renewal next month.

He's been a really good tenant and I like to think he's quite a good friend too - we have lived together for 3 years after all without any real rows/disputes.

All of our agreements have typically lasted twelve months and we have usually agreed he would pay a sum in rent and a flat rate for bills every month. It has worked out about 475 rent and 75 bills per month for the last two years, for what I feel is a decent place in Dublin 4.

I have always offered a pretty good rate for tenants mainly because I'm willing to offer a competitive rent in order to live with someone who is like myself and have an easy life. I still feel this way, though in the last year I have done up the kitchen and my tenant's bathroom to a pretty high standard in the last few months. I didn't increase the rent right after these works were done for two reasons - 1) we were mid contract; 2) I'm sure he had to put up with a bit of incovenience while the builders were in so thought I'd let him see out the agreement on the current terms.

However, with the coming cost of the property tax and a reduction in the amount I actually earn forthcoming ( I am changing career in the autumn and will be on a slightly lower salary than now), I've been doing the maths.

His rent will have to go up about 60e to take account for higher mortgage charges than a few years back and also to contribute to the property tax.

However, I have found the bills for running the house have escalated quite a bit despite regularly ensuring I'm on the best energy tariffs and use the cheapest broadband etc and I've realised I'm subsidising the day-to-day running costs to a much greater extent than when we first agreed the flat bill payment of 75e a month. Is it reasonable for a tenant to pay 180 a month in bills - that's 50/50 with me?

All in all, I'm gonna have to increase his rent and bills from 575 to 710 per month all in. Does this sound reasonable for Dublin 4? Any tips for telling someone their rent is going to jump a lot?!

Thanks for any replies in advance!

The issue here is not rent, it's your bills.

I live in a 2 bed flat (also D4) with my tenant.

My bills are:
ESB €55-60 per month (more in winter)
UPC (WiFi and Cable) €35 per month

So that's €100 max per month. €50 each per month.

How the hell are your bills almost quadruple this??

Rent is at a premium especially in D4 and such areas. €475 is a reasonable rent. You have listed several reasons as to why you want to increase the rent. Most of these are not the responsibility of your tenant, however you are the landlord and you can charge as much or as little as you like.

Increasing the rent by 10% will most likely cause your tenant to leave. Increasing by more than this will certainly cause someone to leave unless they are an idiot, or minted, in which case they probably wouldn't need to share.

It makes no sense giving a flat fee for bills. This means your tenant does not need to be conscious of his energy consumption and for all you know could have heating on 24/7, as well as any appliances in his room.

You need to sit him down and say:
1) Rent needs to be increased
2) All bills need to be split 50:50 (like any normal shared living)

Then let ye negotiate a figure between the two of ye.

djimi

The_Morrigan wrote: »

You still have to declare it honestly, not just pick a random figure out of the sky below the threshold.

How hard is it to keep a copy of bills to be paid and a spreadsheet of payments made by the lodger? Its only the variable bills that need to be concerned with anyway; fixed bills such as TV, internet, refuse etc can be included in the rent as they can be easily calculated.

The_Morrigan

matrim wrote: »

I'm confused how it would affect his tax every month. He would still be getting a fixed rate rent every month and the bills would be separate and I assume not subject to other tax as they are paying for a utility not the rent.

For the rent a room scheme , citizens advice provide information that the amount to be declared to revenue must equate to the rent + any monies received for services included, ie bills.

To get rent a room relief:

• The total (gross) rent you get from your tenant (or tenants), which includes sums the tenant pays for food, utilities, laundry or similar goods and services, cannot exceed €10,000. If you get rental income over and above this amount, you are not entitled to the relief

http://www.citizensinformation.ie/en/housing/owning_a_home/home_owners/rent_a_room_scheme.html

This is why I always have a fixed amount inclusive of bills and have my lodgers pay via standing order so I can provide to revenue if they decide to come knocking on my door.

Paww and myself discussed this previously as the legislation is as clear as mud on this point.

quietsailor

The_Morrigan wrote: »

You still have to declare it honestly, not just pick a random figure out of the sky below the threshold.

as long as the TOTAL monies take in are under €10,000, revenue don't care if it's €9,998 in bills & €1.99 in rent as long as it's under €10,000.

They don't want to be tied down in paperwork for, to them, minor sums of money so why demand cent to cent breakdowns.

If your under €10,000 for all monies received then just put whatever figure you received on the return along with your bank statements backing up the figure - this is why a lot of people are setting fixed rental amounts.

€10,000/12 months = €833.33 per month allowable income over 12 months. If you declare to the revenue

"I received €9,600* from my lodger in the last tax year under the rent a room scheme which includes bills and rent - here are the bank statements showing the monthly lodgements from my tenant" then the revenue will be happy

* = I'm using €9,600 as an example - it's 12 months X €800 per monthh

miss no stars

OP, I rent with 2 others next to the D4 area (literally across the road from). It's a 3 bed spacious apartment that's well furnished and maintained and close to public transport (We were actually quite lucky to get it). None of us are owners, yet my rent is EUR483 per month for a good double (2 bathrooms between 3 people). So for starters, your rent as it stands isn't too far below the market rate. I imagine it's probably a bit nicer than an apartment that's been long term let out rather than owner occupied, but only to a certain extent! As for bills, we have single glazing and our utilities in the coldest part of the year reached about 100 per month (heating and hot water), the rest of the year it'd be around 40 each. That's with very liberal use of them, if it gets chilly we put on the heating and get it toasty, the immersion comes on twice a day for about 5 hours in total, we use the tumble dryer etc. etc. Internet and TV depends obviously on the package you go for, but ours is about 60 a month, then to be split between us. Our bins are communal so not paid by us. Over the course of the year, bills average out at 75 a month each.

That's pretty much what any of my friends (also living in the area renting similar properties) are paying. That's pretty much the market rate. People who pay more rent have lower bills as the increased rent tends to reflect better insulation. So basically I think it's fair to say that the market rate for a bedroom in a shared apartment, plus reasonable bills, is about 600pm. If the place was REALLY nice well insulated and not owner occupied, 710 a month MIGHT be okay... But your place is owner occupied

If you're finding you're subsidizing bills, then separate them. If I was a tenant (or lodger) I would be happy enough with that, provided neither party was taking the mick with usage. Bills that would be acceptable: Electricity, gas, bins, internet, tv. Not acceptable: insurance, apartment complex charges etc. As regards passing on property tax. Eh, fair enough, but you're living there too so only pass on half of it.

Your own financial situation shouldn't come into it. That said, he's been there 3 years and presumably hasn't had a rent increase. It's no longer a renter's market in Dublin so he's probably expecting an increase at this point, especially if his bathroom has been improved. Rents in Dublin increased by what, 5%? That'd bring his rent to about 500. Let's say a full year of property tax for you is 495, that should be 20 euro extra a month on his rent (half the monthly amount, given that you live there too), so his rent ends up at 520. It's just about justifiable, but I still think that's high for sharing with the owner.

So my stance on this would be to sit down and tell him that, in line with market rates, you'd like to increase his rent to 520pm and instead of flat rate bills, you'd like to split utilities down the middle. Then ask for his stance on it.

GusherING

Thanks guys, lots of good advice on here.

I've had a good look at the money again.

I feel from comments on here that a rent of 530 is fine for a nice double bedroom and own bathroom in a pretty well kept apartment in DUblin 4.

I'm glad to hear a lot of people feel the 50:50 principle on the bills is good. We aren't frivolous with the utilities (Normal cable TV, Gas, ESB and Broadband) but they still average out around 200 per month. Perhaps my housemate uses them more than I'm aware he does or perhaps the insulation needs an upgrade, but there is no harm in asking him to split the bills equally in future.

I think I can work the bills down to 100 a month per person. 630 a month all in isn't too bad imo.

djimi

€100 each in bills is a far cry from the €180 you spoke of in the first post.

ebixa82

GusherING wrote: »

Thanks guys, lots of good advice on here.

I've had a good look at the money again.

I feel from comments on here that a rent of 530 is fine for a nice double bedroom and own bathroom in a pretty well kept apartment in DUblin 4.

I'm glad to hear a lot of people feel the 50:50 principle on the bills is good. We aren't frivolous with the utilities (Normal cable TV, Gas, ESB and Broadband) but they still average out around 200 per month. Perhaps my housemate uses them more than I'm aware he does or perhaps the insulation needs an upgrade, but there is no harm in asking him to split the bills equally in future.

I think I can work the bills down to 100 a month per person. 630 a month all in isn't too bad imo.

What other bills are included apart from electricity and cable/wifi?

I live in a 2 bed flat and our bills are (in summer) 50e per person.

It will take some serious changes in habit/energy usage to drop ESB from what you currently use to what you hope.

wolfpawnat

When I was living in an owner occupied, the rule was the room was a cost equal to local rents and equal division of the bills. The property tax I would see as an owner issue, but that is between you and your tenant.

ebixa82

There is no need to mention property tax if a landlord wants to up rent. The property tax is not the responsibility of the tenant but the landlord can build it into the rent.

Landlords can increase rents for whatever reasons they like, and thankfully tenants have the right to refuse and find somewhere else to live.

The OP seems to be a pretty inexperienced landlord by all accounts and is fully responsible for the situation he finds himself.

He is going to attempt to increase the rent by over 10% and risk losing, what he describes himself, as a very good tenant.

He should suggest 530e but expect the tenant (to quite rightly) haggle for a less steep increase.

miss no stars

wolfpawnat wrote: »

When I was living in an owner occupied, the rule was the room was a cost equal to local rents and equal division of the bills. The property tax I would see as an owner issue, but that is between you and your tenant.

Tbh, if I had as little security as owner occupied provides, I personally would see comparing with local rents to be a bit unfair given their security of tenure

djimi

miss no stars wrote: »

Tbh, if I had as little security as owner occupied provides, I personally would see comparing with local rents to be a bit unfair given their security of tenure

Exactly this. There is no way that you can compare renting a room from an owner occupier to be in any way comparible to a normal tenancy, and there is no way that the price of a tenancy should be in any way used as a yardstick for the price for a lodger to rent a room.

wolfpawnat

miss no stars wrote: »

Tbh, if I had as little security as owner occupied provides, I personally would see comparing with local rents to be a bit unfair given their security of tenure

I found there was good and bad to OO, good being the house was always spotless and was to a high standard, that said, you couldn't even scratch yourself without the LL knowing. But you are paying for a room, not the fellow occupiers.

Tar.Aldarion

wolfpawnat wrote: »

I found there was good and bad to OO, good being the house was always spotless and was to a high standard, that said, you couldn't even scratch yourself without the LL knowing. But you are paying for a room, not the fellow occupiers.

Who wants to live with that? I'd avoid it at all costs, she as prepaid esb meters etc, most people would I feel

wolfpawnat

Tar.Aldarion wrote: »

Who wants to live with that? I'd avoid it at all costs, she as prepaid esb meters etc, most people would I feel

The one thing that annoyed me was the calgon for the washing machine, weird one I know, but not my fault even though she didn't live in a hard water area and still insisted on getting it, then dividing the cost of it three ways!

But not all owners are that anal...... I hope.

ebixa82

In fairness not all owner occupiers are that bad. I'm an OO at the moment and it's more often than not that my tenant is giving me grief about cleaning up etc.

It is all to do with how you see the person you live with.

I would consider us to be flatmates and not that he is my tenant as such. His monthly rent is way more important to me than me living on my own at the moment.

Tar.Aldarion

True enough, unfortunately people don't know what living with the owner will be like beforehand. If you mention living in an owner occupied place to people they are against it in general. The only reason to do it is if it's cheaper imo.

ebixa82

Apart from the landlord being (potentially) over controlling and somewhat anal about cleanliness what are the other negative aspects of living with an owner from the tenants perspective.
i.e. what less rights does a tenant in an OO rental (rent a room) have compared to an standard rental?