Rent below market value

vf949

I have a rental property that is away below the market value. Because of the RTB rules I am only able to put up the rent a little but nothing near the market value.

If I let a family member such as my daughter live in it for a period of time am I able to then come back into the rental market in say a year or two at the proper market value? How long would the property need to be out of the rental market before I can do this?

DubCount

AFAIK its 2 years

dennyk

If it's been more than two years since the time the last tenancy ended, the RPZ restriction doesn't apply (at least under current legislation; that is always subject to change in the future, of course...). You're still limited to "market rent", but there's no limit based on the previous rent amount on the last tenancy that ended more than two years ago.

It's important to note that restriction applies to any tenancy, so you must be careful to ensure a tenancy is not established. Per the law, if it's your spouse, parent, or child living in the property and no one living in the property has a written tenancy agreement, it isn't a tenancy under the RTA, so you should be fine if it's your daughter living there (so long as she doesn't sublet the property). If it's a family member other than a spouse, parent, or child, however, there is no exemption in the law for that, and it may be considered a tenancy as a result. A written agreement is not necessary to make it a tenancy. (Also, what a free tenancy would do to your future rent increase limits under the RPZ restrictions might be an interesting question, seeing as how (HICP)% of €0/month would be €0...don't know if that's ever come before the RTB or the courts before.)

Also, note that there are tax implications for letting your daughter live in the property free of charge; [CAT will apply on the difference between the rent she's paying and the rent you could receive](https://www.revenue.ie/en/gains-gifts-and-inheritance/valuation-date-value-certain-benefits/free-use-of-property-and-interest-free-loans.aspx), which will be deducted from her lifetime Group A CAT threshold. That might result in her being liable for additional CAT on future gifts or inheritances eventually. Just something to keep in mind, and to make sure is being properly reported to Revenue to avoid any future unpleasantness from the tax man...

vf949

https://www.boards.ie/discussion/comment/119404846#Comment_119404846

@dennyk thanks for that very comprehensive reply