Rent increase megathread

Michael D Not Higgins

pedrohbaron wrote: »

The block of apartments are in Tallaght but since the apartments were bought from Nama and were unoccupied years before that I think that will rule out the 4% cap. No notice of increase has been given yet but the apartments are being advertised on Daft for 25% more of what I'm paying.

Just thinking in advance so I can make plans, contract is due to be reviewed in July.

No, you don't understand. Your apartment would have to be vacant for the 2 years before they can implement a higher than 4% (plus whatever depending on exact number of months) increase.

If your contract is up in July and you will have been there 2 years at that point, they can implement the first rent review. This will be of the form R x (1 + 0.04 x t/m) where R is current rent, t is number of months between setting of rent (in this case 27 months which is 24 months of the original term and 3 months notice), and m is 24 for the first review. This allows a maximum of 4.5% increase.

http://www.rtb.ie/dispute-resolution/dispute-resolution/rent-pressure-zones

TheChizler

The_Conductor wrote: »

The landlord has a very sellable asset at the end of the process- if he doesn't have a tenancy associated with the dwelling (thanks to the new legislation).

Yeah, that part of the legislation is a load of bollox IMO.

The_Conductor

TheChizler wrote: »

Yeah, that part of the legislation is a load of bollox IMO.

Its fine- it simply means you know the property is going to be worth at least 30% more after you have extinguished any rent level associated with the property- so you keep it vacant for two years- the rent foregone will be nothing compared with the 30% (or more) extra that you'll get once the property has no such rights associated with it.

It takes a bit of forward planning- but it is doable- there is no reason why a landlord wouldn't sit on vacant property for 24 months- even if the market was going south, which it isn't- its unlikely he'd not be better off, for having extinguished rent control associated with the property.

pedrohbaron

Michael D Not Higgins wrote: »

No, you don't understand. Your apartment would have to be vacant for the 2 years before they can implement a higher than 4% (plus whatever depending on exact number of months) increase.

If your contract is up in July and you will have been there 2 years at that point, they can implement the first rent review. This will be of the form R x (1 + 0.04 x t/m) where R is current rent, t is number of months between setting of rent (in this case 27 months which is 24 months of the original term and 3 months notice), and m is 24 for the first review. This allows a maximum of 4.5% increase.

http://www.rtb.ie/dispute-resolution/dispute-resolution/rent-pressure-zones

Thanks for clarify that! I can finally stop worry about the rent review.

I thought that since the apartments were unoccupied 2 years before I rent the 4% cap would be ruled out.

Thanks again.

The_Conductor

pedrohbaron wrote: »

Thanks for clarify that! I can finally stop worry about the rent review.

I thought that since the apartments were unoccupied 2 years before I rent the 4% cap would be ruled out.

Thanks again.

No- a vacant property- which has been vacant for the 2 preceding years- has its associated rent level extinguished. You are a tenant in the property- it is not vacant- your rent level is associated with the property- and the 4% limit most certainly applies (in D24).

beauf

Michael D Not Higgins wrote: »

It limits its potential return so effectively removes the property from an investor perspective and depending on the type of property may not attract attention from PPR buyers.

In the current shortage, its possible that the gain in capital will exceed the net rent lost.

Michael D Not Higgins

beauf wrote: »

In the current shortage, its possible that the gain in capital will exceed the net rent lost.

No doubt, but all other things being equal, if you had two properties at the same selling price but only one has had a previous rental in the last two years below market rent, effectively, for an investor, it's not worth the same.

Samuel T. Cogley

Michael D Not Higgins wrote: »

No doubt, but all other things being equal, if you had two properties at the same selling price but only one has had a previous rental in the last two years below market rent, effectively, for an investor, it's not worth the same.

It's actually going to result in rents increasing, but at a more predicatble rate. Maybe that's the point? I had no intention of increasing the rent on my place but now I'm in a position where I hurt the chances of selling if I don't.

daithi7

Hi Folks,

Apologies if this has been covered already.

Does the rent pressure zone include all of Cork City? Or just particular zones in cork city??

& does that include Little Island (which is just outside the ring road& hence technically in County Cork) say???

ChannelNo5

Again sorry if this has been covered. i rent an apartment in Dublin. been there eight years now. in early November with my six month lease i got a letter of notice from the landlord that they would be increasing the rent at the time of my next lease renewal (April). Does this mean that because the landlord gave me notice back in November that the 4% rule doesnt apply even though my lease is not up until April?

Samuel T. Cogley

ChannelNo5 wrote: »

Again sorry if this has been covered. i rent an apartment in Dublin. been there eight years now. in early November with my six month lease i got a letter of notice from the landlord that they would be increasing the rent at the time of my next lease renewal (April). Does this mean that because the landlord gave me notice back in November that the 4% rule doesnt apply even though my lease is not up until April?

When was the previous review and does the lease proscribe reviews during the lease? The notice also has to be in a specific format.

These 6 month or 12 month leases are a bit of a red herring in my view as you go onto Part IV after 6 months. I welcome correction as to why so many people still do these 6/12 month things. (Apart from the agency gets to charge the LL!)

ChannelNo5

Libertarian Kant wrote: »

When was the previous review and does the lease proscribe reviews during the lease? The notice also has to be in a specific format.

These 6 month or 12 month leases are a bit of a red herring in my view as you go onto Part IV after 6 months. I welcome correction as to why so many people still do these 6/12 month things. (Apart from the agency gets to charge the LL!)

The six month lease was at my request as I wasn't sure what my circumstances would be this year. Normally I just renew it yearly.

My last rent review was 2 years ago so a rent review is due in April anyway

Samuel T. Cogley

ChannelNo5 wrote: »

The six month lease was at my request as I wasn't sure what my circumstances would be this year. Normally I just renew it yearly.

My last rent review was 2 years ago so a rent review is due in April anyway

After your first six months there's no reason to be on a 'lease' really, certainly not since the amendments. I'm open to correction there.

You'd have to see if the notice issued before the amendments met the required form, or if it was just a 'heads up' for want of a better term.

beauf

Michael D Not Higgins wrote: »

No doubt, but all other things being equal, if you had two properties at the same selling price but only one has had a previous rental in the last two years below market rent, effectively, for an investor, it's not worth the same.

If its not worth the same. It won't be at the same selling price.

Michael D Not Higgins

beauf wrote: »

If its not worth the same. It won't be at the same selling price.

Which was the point I was making, the one with a below market rate rental is of a lesser value due to the rent control laws.

daithi7

daithi7 wrote: »

Hi Folks,

Apologies if this has been covered already.

Does the rent pressure zone include all of Cork City? Or just particular zones in cork city??

& does that include Little Island (which is just outside the ring road& hence technically in County Cork) say???

I can't find a specific list of areas myself but when the pressure zones was being introduced there was an article in one of the local papers that suggested areas such as Douglas, Togher and other places just on the outskirts (or more or less in the city in the case of Togher) were not covered by the cap so if that's true I couldn't see little Island being included in the pressure zone.

The_Conductor

daithi7 wrote: »

Hi Folks,

Apologies if this has been covered already.

Does the rent pressure zone include all of Cork City? Or just particular zones in cork city??

& does that include Little Island (which is just outside the ring road& hence technically in County Cork) say???

It includes all of Dublin and Cork cities- and a shopping list of surrounding areas. It does not include all of Galway city- it does however include 8 named areas.

The_Conductor

Michael D Not Higgins wrote: »

Which was the point I was making, the one with a below market rate rental is of a lesser value due to the rent control laws.

Which is why it makes sense to leave it vacant for a 2 year period- to extinguish its rent control restrictions.

ChannelNo5

Libertarian Kant wrote: »

After your first six months there's no reason to be on a 'lease' really, certainly not since the amendments. I'm open to correction there.

You'd have to see if the notice issued before the amendments met the required form, or if it was just a 'heads up' for want of a better term.

Thanks for that. I'm pretty sure the notice met the required form. Guess i'm screwed!

daithi7

The_Conductor wrote: »

It includes all of Dublin and Cork cities- and a shopping list of surrounding areas. It does not include all of Galway city- it does however include 8 named areas.

Thanks, and is there a list of these surrounding areas somewhere ??
(so I can check if little island is on it)

The_Conductor

The_Conductor wrote: »

It includes all of Dublin and Cork cities- and a shopping list of surrounding areas. It does not include all of Galway city- it does however include 8 named areas.

I think the problem is what is the city and what people consider the city are not always the same. Most people would consider Douglas to be in Cork city for instance but it actually isn't and its a place where lot of people live who work in and around the city.

Not sure how accurate the information is but the cork rent pressure zones are discussed in an article on page 5 here: http://data.celticmediagroup.com/epaperview/service/2468

varuka

pedrohbaron wrote: »

The block of apartments are in Tallaght but since the apartments were bought from Nama and were unoccupied years before that I think that will rule out the 4% cap. No notice of increase has been given yet but the apartments are being advertised on Daft for 25% more of what I'm paying.

Just thinking in advance so I can make plans, contract is due to be reviewed in July.

Is that Tallaght Cross? 1 side of the road there's 1 bed apts for 1400 and across the road 1 bed apts is 1150.

pedrohbaron

varuka wrote: »

Is that Tallaght Cross? 1 side of the road there's 1 bed apts for 1400 and across the road 1 bed apts is 1150.

it is indeed. The Canadian company who owns the block went crazy allright with the rents. Unbelivable.

melusina

May I ask about my situation - my current rent increase?
We've been in the property since January 2011. The last rent increase was in January 2015.We received the text from the landlord about the rent increase in October 2016, but only saying they were going to increase our rent in January 2017. We asked for the amount, then the landlord suggested 25% increase in November 2016, effective 90 days later, e.g. from February 2017. We agreed to pay it. The communication was via email.
Now I am reading about the new legislation and wondering whether the landlord was supposed to announce the increase only in January 2017 (after 24 months)? Or was he right to agree the new rate earlier than 24 months after the last increase? Does the 4% cap in any way relate to us or not?
Thank you.

Michael D Not Higgins

You say your last rent increase was in January 2015, when did you receive notice of that increase?

testtech05

Hi guys, just heard about the changes to the rules in Galway on the radio. We are due to have a 10% increase in rent from 1st march and I am wondering can we now challenge that this be limited to 4%?

The_Conductor

testtech05 wrote: »

Hi guys, just heard about the changes to the rules in Galway on the radio. We are due to have a 10% increase in rent from 1st march and I am wondering can we now challenge that this be limited to 4%?

Depends on a few different factors-

1. What part of Galway- not all of the city is included- there are a few areas that seem for no good reason to have escaped being included in the pressure zone.

2. Was notice properly served prior to the inclusion of the area in the pressure zone limits (i.e. the rules in place when the notice was served are the rules that count). If notice was improperly or invalidly served- then you're now under the new regime.

3. There are a few curious opt out and clauses- such as if the property was first let in the last two years, its automatically out of the pressure zone etc.

Your own specific circumstances will determine whether or not you can rely on the 4% increase, rather than the notified increase, however, if the notice was properly served, the notice is valid.

testtech05

testtech05 wrote: »

Hi guys, just heard about the changes to the rules in Galway on the radio. We are due to have a 10% increase in rent from 1st march and I am wondering can we now challenge that this be limited to 4%?

If you have already gotten your notice (which you would have in order to get 3 months notice before your rent increasss) then the 4% rule won't apply.

Saadyst

Just on the topic of valid notices - if the landlord sent a letter without the text about appealing to the PRTB, or any comparisons, the notice is invalid, correct?

In terms of letting the landlord know (and so we will continue to pay original rent), what is the suggest format? Email, registered letter - other?

Thanks

4ensic15

Saadyst wrote: »

Just on the topic of valid notices - if the landlord sent a letter without the text about appealing to the PRTB, or any comparisons, the notice is invalid, correct?

In terms of letting the landlord know (and so we will continue to pay original rent), what is the suggest format? Email, registered letter - other?

Thanks

Recorded mail, e-mail, fax, text and pigeon. Keep copies!