What is "substantial refurbishment"

Michael D Not Higgins

Substantial refurbishment will be taken as a case by case basis if referred for a dispute to the RTB. How long it takes to replace a kitchen in your spare time is not relevant to whether it's substantial or not.

76544567

Michael D Not Higgins wrote: »

Substantial refurbishment will be taken as a case by case basis if referred for a dispute to the RTB. How long it takes to replace a kitchen in your spare time is not relevant to whether it's substantial or not.

I think you'll find it is a substantial piece of work. My back tells me so after doing it many times. So does my pocket. Replacing a kitchen is not a simple job. And neither is replacing a whole apartments floors on It's own, never mind at the same time as a kitchen or any of the ops other issues.
People seem to think updating properties is a piece of p1ss. But i guess watching others work is easy. So that may be why people think these things are trivial.

CIARAN_BOYLE

Substantial has not been defined by a body of legal precedence as of yet. I feel that it is not reasonable for the definition of substantial to be set based on how long it takes a non expert to do it in their free time.

If a professional could do it in a day I don't think you can call it significant.

__Alex__

Julianna Poor Banking wrote: »

Says who? There is no rule to say you have to get a super quick and expensive contractor. We have done lots of work in our own home and spent a long time doing it to get it done much cheaper. I would do it the same in a rented property.

I'd imagine how long it takes you to complete the work is irrelevant. If you decide to spread it out, that's up to you. There will probably be a guide completion time for each type of work.

76544567

CIARAN_BOYLE wrote: »

Substantial has not been defined by a body of legal precedence as of yet. I feel that it is not reasonable for the definition of substantial to be set based on how long it takes a non expert to do it in their free time.

If a professional could do it in a day I don't think you can call it significant.

I would consider myself an expert at doing all kinds of jobs in rental properties. I've been doing them long enough to know what's substantial and what's not.

Though One man's doing it quick is another man's doing it arseways i suppose.

Victor

Julianna Poor Banking wrote: »

Says who? There is no rule to say you have to get a super quick and expensive contractor. We have done lots of work in our own home and spent a long time doing it to get it done much cheaper. I would do it the same in a rented property.

The purpose of the legislation is to protect tenants from abuse. In any case to the RTB, that is what they are looking for. Evicting someone because you can't do a job quickly or promptly is your problem and not one you should transfer to a tenant.

garhjw

Victor wrote: »

The purpose of the legislation is to protect tenants from abuse. In any case to the RTB, that is what they are looking for. Evicting someone because you can't do a job quickly or promptly is your problem and not one you should transfer to a tenant.

Where is this stated in the legislation? Does it say the work has to be completed promptly? Does it say you can't do it yourself? What if you can't afford to pay a contractor to do the work and have to DIY? It's not unreasonable to do work, substantial or otherwise, yourself and in your own time.

4ensic15

garhjw wrote: »

Where is this stated in the legislation? Does it say the work has to be completed promptly? Does it say you can't do it yourself? What if you can't afford to pay a contractor to do the work and have to DIY? It's not unreasonable to do work, substantial or otherwise, yourself and in your own time.

It says the work must be substantial. Just because it takes someone a long time does not make it substantial. Putting a tenant out to indulge in a DIY hobby is unlikely to pass. Quite often if the work takes a long time there is a substantial loss of rent meaning the saving of going the DIY route is reduced or eliminated.

Fol20

4ensic15 wrote: »

It says the work must be substantial. Just because it takes someone a long time does not make it substantial. Putting a tenant out to indulge in a DIY hobby is unlikely to pass. Quite often if the work takes a long time there is a substantial loss of rent meaning the saving of going the DIY route is reduced or eliminated.

It isnt to indulge in a hobby. Its down to cashflow and reducing costs.. Even if it takes one month to complete everything while it would take a few days for a contractor, there is large opportunity cost where savings can be made. Even in PRTb terms, it says it must add value.. Any of the things i mentioned add value so i guess they are substantial refurbishments

4ensic15

Fol20 wrote: »

It isnt to indulge in a hobby. Its down to cashflow and reducing costs.. Even if it takes one month to complete everything while it would take a few days for a contractor, there is large opportunity cost where savings can be made. Even in PRTb terms, it says it must add value.. Any of the things i mentioned add value so i guess they are substantial refurbishments

Guesswork is not enough.

Fol20

4ensic15 wrote: »

Guesswork is not enough.

A lot of what this is is guesswork.. Even how it describes substantial refurbishment is vague and every year its a battle of trying to guess what the government will do next to intervene in the market.

garhjw

4ensic15 wrote: »

It says the work must be substantial. Just because it takes someone a long time does not make it substantial. Putting a tenant out to indulge in a DIY hobby is unlikely to pass. Quite often if the work takes a long time there is a substantial loss of rent meaning the saving of going the DIY route is reduced or eliminated.

Never say doing work DIY wouldn't be substantial. What do you mean substantial loss of rent? Doing something DIY could take 3 weeks vs 1 week for a contractor. I think the cost saving of DIY would be greater than 2 weeks rent if a contractor was used.

CIARAN_BOYLE

garhjw wrote: »

Where is this stated in the legislation? Does it say the work has to be completed promptly? Does it say you can't do it yourself? What if you can't afford to pay a contractor to do the work and have to DIY? It's not unreasonable to do work, substantial or otherwise, yourself and in your own time.

It's not. There's no body of precedence through the courts so we don't know how the word substantial will be interpreted.

Those of us who have some experience with the costs expect that the word substantial be determined by the expectation of a 'reasonable person'. I consider myself reasonable. I would not consider something substantial if a competent professional can do it in two days. You deciding to do it in your own time over three weeks doesn't change my opinion as to whether it's substantial.

76544567

CIARAN_BOYLE wrote: »

It's not. There's no body of precedence through the courts so we don't know how the word substantial will be interpreted.

Those of us who have some experience with the costs expect that the word substantial be determined by the expectation of a 'reasonable person'. I consider myself reasonable. I would not consider something substantial if a competent professional can do it in two days. You deciding to do it in your own time over three weeks doesn't change my opinion as to whether it's substantial.

Well the ops list is a hell of a lot longer than two days work any way you cut corners.

Anyway there is much more at play nowadays. These days no work will be done on properties during tenancies. And if the RTB start to deem substantial work not substantial, well we know where that will go.

CIARAN_BOYLE

76544567 wrote: »

Well the ops list is a hell of a lot longer than two days work any way you cut corners.

Anyway it's a moot point. These days no work will be done on properties during tenancies. And if the RTB start to deem substantial work not substantial, well we know where that will go.

True. Most people are saying anyone of them is not substantial but all of them probably are substantial.

Victor

I spoke to a friend who has worked in property maintenance and refurbishment.

He makes a good point about whether the work makes the property uninhabitable or not. So, if it is a bathroom refurbishment and there is only one bathroom, that is much more likely to be "substantial refurbishment" than a situation where there are several bathrooms.

tradingwizz

There is a lot of conjecture here about what is substantial refurbishment. I talked to a senior representative at both RTB and Dublin City Council. The simple definition of "substantial refurbishment" is if the works "increase the selling price of the property". It's that simple. Everything else regarding whether the property is inhabitable during refurbishment etc is just hearsay.

So basically it is a 2 step process to having permission to increase the rent beyond the RPZ calculator. In my case specifically I have a tenant who is on rent allowance (€950) and wants to join the HAP scheme and go out and work. It makes no sense to go out and work for a HAP of €950 when she already gets rent allowance of €950 for not working at all. For me, I need to get something close to market rent which is €1500-1600 in my area. €1250 would be fine if I got that for HAP and the tenant would be happy too since she can go out and legitimately work.

The 2 steps are:
1) Get RPZ exemption. This is based on satisfying the requirement for substantial refurbishment above.
2) Provide proof of market rent by providing 3 examples of recent rents of similar properties in the area.

The main point here is that exemption is just a *key* to legitimately unlocking rent increase to market rent. It is not depending on the type or size or how many different refurbishments there are. There is also no relationship between the amount invested in the refurbishment and the amount by which you can increase the rent - this is important to know.

davindub

tradingwizz wrote: »

There is a lot of conjecture here about what is substantial refurbishment. I talked to a senior representative at both RTB and Dublin City Council. The simple definition of "substantial refurbishment" is if the works "increase the selling price of the property". It's that simple. Everything else regarding whether the property is inhabitable during refurbishment etc is just hearsay.

So basically it is a 2 step process to having permission to increase the rent beyond the RPZ calculator. In my case specifically I have a tenant who is on rent allowance (€950) and wants to join the HAP scheme and go out and work. It makes no sense to go out and work for a HAP of €950 when she already gets rent allowance of €950 for not working at all. For me, I need to get something close to market rent which is €1500-1600 in my area. €1250 would be fine if I got that for HAP and the tenant would be happy too since she can go out and legitimately work.

The 2 steps are:
1) Get RPZ exemption. This is based on satisfying the requirement for substantial refurbishment above.
2) Provide proof of market rent by providing 3 examples of recent rents of similar properties in the area.

The main point here is that exemption is just a *key* to legitimately unlocking rent increase to market rent. It is not depending on the type or size or how many different refurbishments there are. There is also no relationship between the amount invested in the refurbishment and the amount by which you can increase the rent - this is important to know.

I would seek better qualified advice tbh, the council wouldn't have any sort of training and it's unlikely the RTB person you spoke to had either. Ideally if you were to get advice, it would be from an adjudicator, not admin/ managerial staff. There are two very different pieces of the legislation in your description which have been merged together.

1. Is the grounds in section 34 of the RTB act to allow termination by the landlord on the grounds of "substantial refurbishment", nothing to do with increasing the market rate.

2. The exemption in the 2016 RPZ amendment, allowing for an increase beyond the rent increase limits on the grounds there have been substantial changes to the nature of the property (note refurbishment is not mentioned, no relation to section 34).

tradingwizz

‘substantial change in the nature of the accommodation’ includes substantial refurbishment works - this is the way the ruling is being applied and this is what matters.

In my case, it is Dublin coco who decide - I just need to get close to market rent since it is being held artificially low. The coco and anyone else will refer to RTB for ultimate adjudication which is why I needed to know the exact criteria being used. Also, the substantial refurbishment doesn't mean I need to remove the tenant from the property - for sure this could never be the intention but could be seen as an unfortunate consequence. Of course, the tenant gets first rights to the refurbished property, albeit at the higher rent.

davindub

Well if the tenant is accepting it, you're probably fine but the legal situation is different. It is very unlikely change in nature will include refurbishments at all if tested. Maybe if you add an extra bedroom etc.

Bass Reeves

What many are forgetting is what is minor refurbishment in a single apartment may be major refurbishment in an apartment block. We see now the advantages of ''professional landlords'' many were warned about this but choose to belive that faraway hills were green.

It was highly unlikly that REIT's would be cheaper or take a less commercial look at renting that smaller type landlords. To a large REIT it would be cheaper to do a complete refurbishment to a block of apartment rather than doing them individually. More than likly they will refurbish the common area's are well and this in itself makes it a major refurbishment. On a commercial tender for refurbishment in a case like this empty apartments will mean a cheaper tender price and a faster process for both contractor and REIT and no risk of an insurance issue.

If tenants were insitu REIT and contractor would have to sort out insurance risk. Is the REIT/Landlord using the legislation to there advantage I imagine yes. But that is reality. It a bit like the issue regarding deposits taht is becoming an issue with REITS as they look for 2 months depoit along with first months rent.

Now we are hearing calls for escrow accounts. What cost will be involved in Escorow holding deposits 10-20% +1-2%/year of lease, Over a 5 year lease it would account for 15-25% of the deposit before you come to who decides what is wear and tear and what is damage.