Questions on how to approach raising my tenants rent.

Bexil

I know a landlord wont be popular on this board for a topic like this but let me explain and ask first as I think you'll see where I'm coming from here.

I own a 2 bed apartment close to Shankill and rent out the smaller room to a friend who's lived with me for about 6 years on and off. Initially we had not formalised anything. I agreed to a Mates rate of €250 a month not including Bills.

Since then I havent raised the rent once and have been fairly flakey about asking for bills.

Im now in a financial position where I HAVE to put his rent up and Im not certain how to go about it.

From what I know I can only put up his rent by a MAX of 4% every 2 years even if he hasnt had any rent increases since he moved in.

He's also claiming rent Allowance which covers his rent completly but I'm not sure if there is another limit imposed on me by the Rent Allowance like the 4%.

He's also asked if his girlfriend can move in for 3 months. Would I need to start a new contract with him and her for the duration she stays and then switch back to the old contract when she is gone?

The other question I have is about the rules for eviction (Not relevant in this situation at the moment but while Im here might aswell ask.) The 3 allowed reasons are, Selling the place, family or personal use and repairing.

If I was to give my tenant notice and I didnt rent out the room after he left would that fall into the Personal use section as I live in the apartment?

LuckyLloyd

The scenario you have outlined indicates that your mate is a licensee, rather than a tenant in receipt of rights offered by Residential Tenancy Acts. You can have a direct chat with him and have the ability to ask him to leave with minimal appropriate notice.

Have an honest chat about where things are for you, what you think you need for the room and see what he says. Take it from there.

EDIT: some useful information here:

http://www.citizensinformation.ie/en/housing/renting_a_home/sharing_accommodation_with_your_landlord.html

Bexil

I appreciate the fast response but Im definitely not looking to get rid of him at all. (I really should have left the eviction bit out....)

Its the rent increase I'm looking at. I know I have to give 3 examples of the average rental cost around the area as guidelines but they are all in the €480 to €800+ range and the max I believe I can charge is €250 + the 4% increase so €282 which will be stuck at until the next increase is allowed. I wanna get a good deal for him, a deal I can afford to live with and a deal that stays inside the law but its starting to get very difficult to do all 3. It looks like either he'll get screwed or I'll get screwed and I think he has more of the law on his side ....

antoinolachtnai

Bexil wrote: »

I appreciate the fast response but Im definitely not looking to get rid of him at all. (I really should have left the eviction bit out....)

Its the rent increase I'm looking at. I know I have to give 3 examples of the average rental cost around the area as guidelines but they are all in the €480 to €800+ range and the max I believe I can charge is €250 + the 4% increase so €282 which will be stuck at until the next increase is allowed. I wanna get a good deal for him, a deal I can afford to live with and a deal that stays inside the law but its starting to get very difficult to do all 3. It looks like either he'll get screwed or I'll get screwed and I think he has more of the law on his side ....

No you don’t. He’s not a tenant. You can set the rent at whatever you want. There is no legal constraint.

James Bond Junior

Hang on, you need to clarify if you live in the apartment and he rents a room or if he rents the whole apartment and you live elsewhere.

whomitconcerns

You can make the rent 1000 a month tomorrow if you want... He's a lodger/licensee. There is no legal backing or otherwise needed. You can do it on a whim. So don't worry about that. Just decide what you want from him and have a discussion.. if he's not interested then ask him to move out.. Again no notice necessary but would be good to give him a heads up.

P_1

Sit down with him and explain the situation. Communication is key in situations like this

Pelvis

250 a month and not even splitting the bills???

It's no wonder you HAVE to now put up the rent. You practically have a dependent.

banie01

If you are living in the property and your friend rents a room from you he is not a Tenant, he is a licensee.
It's a very different thing and it is not governed by the rent rpz rates nor the normal "tenancy" agreements.
You may raise the rent to whatever level you wish in this circumstance.
That said, nothing sours a friendship quicker than money but I would hope your friend appreciates the cheap ride they have to date.

Bexil

James Bond Junior wrote: »

Hang on, you need to clarify if you live in the apartment and he rents a room or if he rents the whole apartment and you live elsewhere.

I purchased the apartment myself and have lived there ever since. He rents the smaller of the 2 rooms and I have the master bedroom. (Should have bought the apartment with the en-suite through. Morning shower queues when you're 32 years old is a bit much.)

handlemaster

Cut to the chase your friend has a brain the rent is way to low. Bring it to market rate. Thats it. Dont go apologising etc he should thank you for been a mug for six years.

wirelessdude01

Firstly why are you flaky on the bills?
Secondly you can raise the rent to whatever you want as you are not a landlord in the traditional sense.

Hitman3000

Bexil wrote:

I purchased the apartment myself and have lived there ever since. He rents the smaller of the 2 rooms and I have the master bedroom. (Should have bought the apartment with the en-suite through. Morning shower queues when you're 32 years old is a bit much.)

Your mate is a licencee you can set the rent at whatever you want.

stargazer 68

wirelessdude01 wrote: »

Firstly why are you flaky on the bills?
Secondly you can raise the rent to whatever you want as you are not a landlord in the traditional sense.

And certainly don't let his girlfriend move in at that rent! Or at all imo - you will never get rid.

The_Conductor

Bexil wrote: »

I purchased the apartment myself and have lived there ever since. He rents the smaller of the 2 rooms and I have the master bedroom. (Should have bought the apartment with the en-suite through. Morning shower queues when you're 32 years old is a bit much.)

He is a licensee- not a tenant.
There are absolutely no limitations on what you set the rent at.
You can earn up to 14k per annum letting a bedroom in your property under Revenue's rent-a-room scheme- without incurring any tax liability.

I would suggest that there is no way on earth you should let his girlfriend move in- the situation 'as-is' is completely and utterly taking the piss- him moving the girlfriend in- really is taking the mick well and truly.

Its a bad idea to let rooms to family or friends- for precisely the reasons you've encountered.

Forget about Citizen's Advice, the RTB or any rules or regulations- you are letting a room to him- in your property, in which you are living- he is not a tenant- and you need to stop calling him one- as it implies he has significant rights that he does not have. HE IS NOT A TENANT, YOU ARE NOT A LANDLORD.

You do not have to show him any justification whatsoever for increasing the amount you're charging- the going rate for a houseshare in Shankill- could easily be as much as 1,000 per month- not the 250 all-inclusive you're subbing him with.

Under no circumstance let him move the girlfriend in- it changes the entire dynamic in a house- and you'll rue the day you let him do it.

I'd suggest nearly doubling the rent to close on 500 a month- which is still a fraction of what you could get- if you were to get a randomer in off the street.

For the record- a single person in shared accommodation, in Dunlaoghaire Rathdown- is entitled to a Housing Assistant Payment (HAP) of EUR430 per month link here. I would suggest an immediate increase to this level- with share of bills on top of this.............

Just to reiterate- EUR430 a month + bills- and under no circumstance should the girlfriend be allowed in...........

You have been subsidising his accommodation massively- for no good reason- he could go down tomorrow and get 430 Euro a month HAP- and no-one would blink an eyelid...........

punisher5112

€14k can be earned tax free.

You need to be straight with them and tell them how it is.

You should really consider getting someone else and rent it out at a proper rate unless he can agree on a price you would be happy with

Wow he fell on his feet with you.

A shed costs more then €250 a month

If the gf gets in the place will no longer be your home it will be their home and you will be in the way.

The_Conductor

punisher5112 wrote: »

If the gf gets in the place will no longer be your home it will be their home and you will be in the way.

It changes the whole dynamic.
It doesn't matter what either of them say to try and assuage your fears- you will be an interloper in *their* home- once she moves in- regardless of the fact that its your apartment, not theirs.

If they want to get a place together- great- let them- and then get a proper rate for the bedroom- I'd suggest given its location- that 800'ish is easily achievable- if you pop into St. Michaels, or St. Vincents- or St. Colmcilles- there are hundreds of nurses, porters and students- all killing each other to try and get a houseshare.

pillphil

The_Conductor wrote: »

Just to reiterate- EUR430 a month + bills- and under no circumstance should the girlfriend be allowed in...........

Especially as it wouldn't cost your mate anything. You should keep it at least in lien with the max rent allowance/hap

Edgware

You do realise that you are being taken advantage of. Some mate!

Klonker

Put it up to market rate asap. Either he pays or moves out and you get someone else. You've been too generous for too long. If he has any decency he'll thank you for the favour you've done him all these year's.

Sardonicat

How is the Rent Allowance covering ALL the rent?

Did you declare a higher amount to the Social?

Fol20

Bexil wrote: »

I appreciate the fast response but Im definitely not looking to get rid of him at all. (I really should have left the eviction bit out....)

Its the rent increase I'm looking at. I know I have to give 3 examples of the average rental cost around the area as guidelines but they are all in the €480 to €800+ range and the max I believe I can charge is €250 + the 4% increase so €282 which will be stuck at until the next increase is allowed. I wanna get a good deal for him, a deal I can afford to live with and a deal that stays inside the law but its starting to get very difficult to do all 3. It looks like either he'll get screwed or I'll get screwed and I think he has more of the law on his side ....

As others have said. He’s a licencee rather than a tenant so if for example your had rent set at 1e a month, you could then increase it to 1k as the residential tenancy act isn’t applicable to you.

TimeToShine

Your mate has some cheek. Raise the rent to 430 as per The_Conductor's post and slap another 430 plus bills for the missus. I'm assuming by how you've phrased your post that since you didn't flat out reject his request to move her in he's taking it as a tentative yes which is going to lead to a lot of trouble.

Imagine housing a couple in Shankill for 250 including bills, that's less than you'd pay in Bantry!

4ensic15

TimeToShine wrote: »

Your mate has some cheek. Raise the rent to 430 as per The_Conductor's post and slap another 430 plus bills for the missus. I'm assuming by how you've phrased your post that since you didn't flat out reject his request to move her in he's taking it as a tentative yes which is going to lead to a lot of trouble.

Imagine housing a couple in Shankill for 250 including bills, that's less than you'd pay in Bantry!

Bantry isn't that dear!

Fol20

Completely agree with conductor as well. If it was your girlfriend, he would have no power or control however if its his girlfriend, the dynamic will change and it will be 2 against 1. Secondly the shower situation might get worse. Personally if he was a mate, i would still give him the mate rate of maybe 50 to 100 off the going rate. so lets say going rate in your area is 500 a month, then i would do maybe 425 plus bills.

Another item i would recommend is i would add up your bills over the course of a year, divide by 12 and then add that onto the rent so it takes out both of you forgetting to pay bills out of it. Broadband and bins will be easy to calculate. With electricity and gas you can ask them to average out your bills for you and then add all that onto his rent and sure if there is a jump in the gas/electrcity bill in a year of an extra 100 or whatever you can always come back to him with the jump if any.

Ginger83

If you let his missus move in YOU will feel like the lodger. I see trouble ahead.

LotharIngum

Just to give you an idea of how you should be looking at it from your point of view.

Imagine €750 per month was the going rate for the last six years (average). So you only charge €250 - €500 less than the average market rent over that time.

You have lost €500 x 72 months = €36,000 tax free. What could you have done with that.
Your friend has had €36,000 worth of good will from you.


Now look at it going forward.


A couple of years ago there were a lot of landlords who left theur tenants rents ant far below market rate, much like yourself.
Overnight legislation was brought in to ensure that they couldn't ever increase their rent again by more than 4%, even for new tenants.
All of these landlords are being royally screwed. A lot of them are probably in trouble. And also the value of their property has been effecyed negatively because of it too.
All of them wish they could go back and charge the max rent allowable, so that they didn't get screwed by the government, but they cant.

So think about.
You are already down €36,000. If they change the law for licensees overnight, which they probably will soon, you are stuck on €250 pm plus 4% forever. Think long and hard. Beat any rent control before it comes in under the radar. Increase your rent to market rate right now.

Or look at your situation another way.
Would you just hand your lodger €36,000 in cash tomorrow. Because that's what you did. Probably more than that actually.


And to add insult to injury, his mrs is moving in. God bless your innocence

K.Flyer

This is a perfect example of the old adage that you should never mix money with family or friends.

Just to add to what Lotharingum has pointed out about You being Down 36,000 euro, your friend has lived with you practically for Free.
Let that sink in for a few minutes!

As you have now learned, he is Not a tenant with tenancy rights, you can show him the door Anytime.

As Conductor says, research the going rate, work out your bills, and sit him down and spell it out clearly to him what your situation is.

Most likely the increase will be covered by social welfare, so he won't be bothered by it.

And under no circumstances are you to allow a third person into the apartment, you already have one freeloader, you do not need two off them.

Don't leave it to drag on. You say your financial situation is now not great, why why should you carry the pain and burden while he swans in and out of your home and it doesn't cost him anything, plus him wanting to add his girlfriend into the mix will only increase Your financial burden.
Time to have a serious talk with him.

utmbuilder

aww you missed the boat on this rent reductions now..

Pelvis

LotharIngum wrote: »

Your friend has had €36,000 worth of good will from you.

Well, the tax payer has. The 'friend' is getting a free ride.

quietsailor

OP, have you signed any kind of a lease or paperwork with this "mate "

At present they are a lodger or licencee NOT a tenant and have little rights - the usual right given in licenced situations is the rental period is the notice period and no reasons need to be given to finish the agreement. (That goes for both sides ). HOWEVER, if you sign a lease you increase their rights so if you have will you let us know what it says.

Throwing my own opinion in here, this "mate " is no friend at all and you are better off getting them out of your life completely but definitely out of your house. Get them gone and look into renting the room to someone else. As said up thread you can earn up to €14K per year tax free - that is rent plus their portion of bills so be careful how you word the advertisement.

14000/12 = 1166.66666 -- say €1,100 per month for rent and bills and you legally won't have to pay tax.

Other threads on here have mentioned renting to students (digs) or to people who go home for the weekend and only want a Sunday night to Friday morning rent, you would get the house to yourself at the weekends if you want.

Good luck and let us know what you decide