When can rent be increased by 4%?

Finbarr Murphy

Hi All,

I've been doing some research for my wife's old neighbour.

He is a landlord with a tenancy ending and a new tenancy starting around 1st March. He last increased the rent on 1st January 2016 so as I understand it the next allowable increase is on 1st January 2017.

So for the new tenancy is it best that he issues a 10 month lease at the old rent rate and then issues a 90 day notice of rent increase in September?

He is in a pressure zone and before anyone asks he is an old man and i am not sure that he even owns a computer which is why I'm asking on his behalf.

Many thanks

Paulw

Finbarr Murphy wrote: »

He is a landlord with a tenancy ending and a new tenancy starting around 1st March. He last increased the rent on 1st January 2016 so as I understand it the next allowable increase is on 1st January 2017.

So for the new tenancy is it best that he issues a 10 month lease at the old rent rate and then issues a 90 day notice of rent increase in September?

Is the tenant leaving when the tenancy ends? If not, then it's not a new tenancy. Also, after the first 6 months, a tenant inherits Part IV rights, so does not need to sign a new lease at all.

If he takes on a new tenant, then he can increase the rent by 4%.

CramCycle

Finbarr Murphy wrote: »

Hi All,

I've been doing some research for my wife's old neighbour.

He is a landlord with a tenancy ending and a new tenancy starting around 1st March. He last increased the rent on 1st January 2016 so as I understand it the next allowable increase is on 1st January 2017.

So for the new tenancy is it best that he issues a 10 month lease at the old rent rate and then issues a 90 day notice of rent increase in September?

He is in a pressure zone and before anyone asks he is an old man and i am not sure that he even owns a computer which is why I'm asking on his behalf.

Many thanks

Why doesn't he just set the new rent at the value he wants close to current market rates? I thought the 4% increase was only for continuing tenants. If they are new tenants with a new lease, he can just ask for the market rate in his advertisement. Could be completely wrong but that was my understanding.

Paulw

CramCycle wrote: »

Why doesn't he just set the new rent at the value he wants close to current market rates? I thought the 4% increase was only for continuing tenants. If they are new tenants with a new lease, he can just ask for the market rate in his advertisement. Could be completely wrong but that was my understanding.

You are incorrect. The 4% increase also applies to new tenants. The law doesn't differentiate between tenants, only the previous rent and any increased rent.

CramCycle

Paulw wrote: »

You are incorrect. The 4% increase also applies to new tenants. The law doesn't differentiate between tenants, only the previous rent and any increased rent.

So if the previous tenants vacate, and the place is empty for awhile. The landlord advertises at market rates and then gets a new tenant, with no connection to the old one. He is legally bound to only advertise at 4% above the previous rent? Does PRTB keep an eye on this or only if there is a complaint. How would the new tenant know if the landlord just said the rent was higher before the limits came in.

It makes sense and is the only way the law would be of use if done your way, just never knew that, the more you know as they say.

Paulw

Unless it has been empty for over 2 years or there has been major renovation. If either of those happen, then the rent can be set at market rate.

Otherwise, the maximum new rent can only be 4% greater than the previous rent.

I would assume that the RTB monitor this when new tenancy is registered with them.

q85dw7osi4lebg

Apologies for hijacking:

If an investor buys a new property that was previously let out by previous owner, can he / she set rent at market value or must it be only 4% above previous rental income when owned by previous owner?

Paulw

Owner doesn't matter, tenant doesn't matter.

Rent and rent increase is all that matters, according to the law.

q85dw7osi4lebg

Cool, thanks.

Paulw

Paulw wrote: »

I would assume that the RTB monitor this when new tenancy is registered with them.

Assuming the previous tenancy was registered, even if it was registered they may not have said how much the rent was and even if they did it could have been changed a lot since the figure that was given.

LuckyLloyd

Jocelyn Unkempt Dancer wrote: »

Assuming the previous tenancy was registered, even if it was registered they may not have said how much the rent was and even if they did it could have been changed a lot since the figure that was given.

I expect they'll start asking for amount of rent and publishing same shortly

Fian

Finbarr Murphy wrote: »

Hi All,

I've been doing some research for my wife's old neighbour.

He is a landlord with a tenancy ending and a new tenancy starting around 1st March. He last increased the rent on 1st January 2016 so as I understand it the next allowable increase is on 1st January 2017.

So for the new tenancy is it best that he issues a 10 month lease at the old rent rate and then issues a 90 day notice of rent increase in September?

He is in a pressure zone and before anyone asks he is an old man and i am not sure that he even owns a computer which is why I'm asking on his behalf.

Many thanks

If the same tenant is in situ he can next increase the rant on 1 January 2018, with a 90 day notice period so that the increase will take place 90 days later, but it can be notified on the 1 January 2018. He should not sign a new lease in those circumstances.

If the sitting tenant is leaving and a new tenant is coming in he can increase the rent when the new tenant arrives, applying the formula set out in the Act.

Fian

Fian wrote: »

If the same tenant is in situ he can next increase the rant on 1 January 2018, with a 90 day notice period so that the increase will take place 90 days later, but it can be notified on the 1 January 2018. He should not sign a new lease in those circumstances.

If the sitting tenant is leaving and a new tenant is coming in he can increase the rent when the new tenant arrives, applying the formula set out in the Act.

If the rent increased on 1st of Jan notice would have to have been issued on the 1st of October (3 months notice). Therefore the rent increase notice can be given on the 1st of October 2017 with the increase to kick in on the 1st Jan 2018.

syndrome777

Jocelyn Unkempt Dancer wrote: »

If the rent increased on 1st of Jan notice would have to have been issued on the 1st of October (3 months notice). Therefore the rent increase notice can be given on the 1st of October 2017 with the increase to kick in on the 1st Jan 2018.

no, it's actually as Fian said. notice can be give after 24 months, and then rent increased 90 days after.
So notice in Jan 2018 and increase starts no earlier then April then.

syndrome777

syndrome777 wrote: »

no, it's actually as Fian said. notice can be give after 24 months, and then rent increased 90 days after.
So notice in Jan 2018 and increase starts no earlier then April then.

First off it's now 12 months between increases now again not 24.

It's also 12 months bettem noticea being given so if notice was given on 1st October 2016 for an increase 1st Jan 2017 then notice can be given on 1st October 2017 for an increase on 1st of Jan 2018. 12 months between notice of rent increase is the rule so what I'm saying is correct.

You are confusing with the situation of the first rent review for a new tenancy. This review can't occur until the 12 months is up with 3 months notice before the rent actually increases but all subsequent reviews can occur on the date of the first review thus the increase in rent occurs every 12 months from then on.

syndrome777

Jocelyn Unkempt Dancer wrote: »

First off it's now 12 months between increases now again not 24.

It's also 12 months bettem noticea being given so if notice was given on 1st October 2016 for an increase 1st Jan 2017 then notice can be given on 1st October 2017 for an increase on 1st of Jan 2018. 12 months between notice of rent increase is the rule so what I'm saying is correct.

You are confusing with the situation of the first rent review for a new tenancy. This review can't occur until the 12 months is up with 3 months notice before the rent actually increases but all subsequent reviews can occur on the date of the first review thus the increase in rent occurs every 12 months from then on.

to be fair I might be confusing things as I am not an expert. I was under the impression that since the last increase was on 1st January 2016 the "old" rule applied....ones where no rent review can be done in the next 24 months....and there after will be 12 months?

and even for the time duration , I am not sure is it 24/12 months from notice till notice or between last increase till new notice...I know people were quoting ptrb with different examples covering both scenarios. Very confusing

syndrome777

syndrome777 wrote: »

to be fair I might be confusing things as I am not an expert. I was under the impression that since the last increase was on 1st January 2016 the "old" rule applied....ones where no rent review can be done in the next 24 months....and there after will be 12 months?

and even for the time duration , I am not sure is it 24/12 months from notice till notice or between last increase till new notice...I know people were quoting ptrb with different examples covering both scenarios. Very confusing

You are actually right that the rent can't increase for 24 months (from 1 jan 2016). I read it as the rent had been increased 1st Jan 2017 which would be under the new rules but as it happened in 2016 then the 24 months does apply.

The notice of rent increase can be issued on the anniversary of the last notice of rent review rather then the last increase. So if notice was given on 1st october 2015 then notice can be issued on the 1st of october 2017 and the increase can kick in on 1st Jan 2018.

Michael D Not Higgins

I was just thinking of something related to this. The market rate is still in effect from the Act, so if there's a block of apartments say, and lots are rented below market rate and they're locked in to how much they can increase, how does the RTB establish market rate anymore?

Let's say all the apartments are identical. The review for a particular one has come up and they're in the middle for rent for the block and the landlord is looking for 4%. The tenant can point at the lower priced ones in the block and say he should get a decrease, the landlord can point at the higher ones and justify an increase.