Advice needed, Rent Drop

gizzemoto

Hi
I am currently renting a 3 bed house in galway, Last october I renewed the lease for 1 year. I am paying €850 p/m.
I have come across the house next door up for rent, which is also a 3 bed and has been very recently decorated and done up. Both houses are owned by the same person and are been managed by property management. The same house is up for €795 on daft.ie and i have also seen another house up for €775 and this is also in the same area but is rented by a different person.
I spoke to the management company who are basically auctioners and she explained to me that the rent is cheaper next door because they caint get anyone to rent it,(It has been sitting idle for 2 months or so) and futhermore I had signed the lease and that it could not be changed.
I have been a model tenant and never caused any problems. I greatly appreciate any advice please as im gutted that im been ripped off and feel i can't do much about it.

EKRIUQ

You signed a lease, and have to live by your own actions. If the rent was higher would you be offering to pay more?

gizzemoto

i would and thanks for your reply

SoupyNorman

Im caught paying 100 more a month then the exact same 1 bed apartment next door, which went on the market 1 month after I moved in. Flip all I can do...You sign, resign yourself to the contract :mad:

iguana

gizzemoto wrote: »

i would and thanks for your reply

I very much doubt that. If they had called you this week and said market rent has gone up and they now want €950pm you would be telling them you signed a lease and they couldn't change the rent until the lease ended.

The only possible action you have now is to tell them you are very disappointed in them signing you on for a year and then dropping the price on nextdoor. Because of this you will most certainly be moving in October. However you would sign an 18/24 month contract now at a lower rate. Obviously this only works if you know you would want to stay that long and they would still be within their rights to say no.

I'd also suggest that you check your contract and see if it says anything about a 6 month break. If so you could just move when that comes around.

Afuera

There is a clause in the Residential Tenancies Act 2004 that says the rent can not be set above market rate. It appears you are paying above that at the moment. The problem is that there is also a clause in the same act that states a tenant is only entitled to ask for a rent review once a year. If you can't ask for a rent review until next October, I'm not sure how you can force the rent down now.
I think you should get on to Threshold and explicitly tell them that you were duped into paying above market rate and ask them what can be done about it. Tell them you know that there is protection in the RTA 2004 somewhere to stop landlords ripping off tenants but try and get them to explain to you how much protection it really gives.

Sir Oxman

I signed a lease in september juts gone, now ads on daft for same street/type of house are 100-150 less.

Theres feck all I can do about it - I needed somewhere so paid going rate in September.

I think the OP has to suck it up and let it be personally unless he/she has a good rapport with landlord.

Personally, if I got on well with landlord I would approach the subject and see how it goes - ya never get anything without asking.

OP could also say she'll leave, break contract and forego deposit - reading the story the landlord can't rent the other house next door so will be looking at being stuck with two houses lying idle losing money hand over fist for the sake of 75x12
OP would have to be prepared to go though if he called his/her bluff...

SimpleSam06

Afuera wrote: »

The problem is that there is also a clause in the same act that states a tenant is only entitled to ask for a rent review once a year. If you can't ask for a rent review until next October, I'm not sure how you can force the rent down now.

He did mention that he was renewing the lease however - does that not imply he has been there for at least a year already?

Afuera

SimpleSam06 wrote: »

He did mention that he was renewing the lease however - does that not imply he has been there for at least a year already?

Actually, you could be on to something here. I was assuming that the rent had been reviewed when he resigned the lease. If there was no rent review then it would make the world of difference. He would be able to sent a letter to the landlord/agency requesting that the rent be set at the market price of X. If the landlord/agency refused to lower the price, the PRTB have to power to enforce it.

mikemac

I signed a lease in June and it was a good deal at the time and 100euro under the rate similar proporties in the area charged.

But rents have realy fallen here and now I'm pay over 100 euro what other places are advertised at.
Nothing I can do until lease is up. But that's how things work out

johnnyskeleton

micmclo wrote: »

I signed a lease in June and it was a good deal at the time and 100euro under the rate similar proporties in the area charged.

But rents have realy fallen here and now I'm pay over 100 euro what other places are advertised at.
Nothing I can do until lease is up. But that's how things work out

Look for a downwards rent review.

mikemac

But don't you have to wait one year?

321654

Good luck getting the PRTB to do anything for you.

They are next to useless.

ixoy

What about in the case where your 1-year lease has expired? I know we still have many of the same rights as if had a contract but how does it now factor into rent reviews? We've never had one and we're now paying above market rates.

Calina

AFAIK, rent reviews can only be held once in 12 months. This was to prevent landlords pushing up the rents ad infinitum. If you haven't had one in that long, you could enquire about having one.

Also, check your lease for a clause involving de facto renewals for an equivalent term. I forget the exact terminology but I know one of the leases I had in the past allowed for a rollover of the lease for an equivalent term (ie de facto renewal for 12 months if it was a 12 month lease) so it could be that you are still covered by your lease.

Either way, I don't see why you can't request a rent review particularly if it would be in your favour. I would not, however, do it, without being prepared to move if your landlord is playing hardball.

cormie

Could anyone tell me the market value of my place here. It's got the layout on the right, so it's pretty small. And it's in the black circle, so great location.

http://img237.imageshack.us/img237/3337/houseplanjk8.jpg

I'm paying what I think is a VERY reasonable price for it, or at least it was when I moved in in Jan 07 as I'm paying less than the IEP equivalent stated in the lease. I've my own front door and back yard and shed (at front of house as oppsed to in the yard) ground floor, storage heaters and fire place if that makes a difference.

Would be interested to know the market value. Also, I only ever signed a contract in Jan 07, it was for a year, I didn't resign anything, is that good for me?

tedstriker

Ring the landlord and ask to have rent reduced on the basis that rents are going down everywhere. If he says no then leave and go elsewhere. Your contract isn't worth the ink that was used to sign it. Tell him you are giving him four weeks notice to leave, which is required by law, and then go elsewhere. If he is a good landlord he will appreciate good tenants (if you are a good tenant) and will reduce the rent in order to make sure he doesn't have another empty place.

Read this, section 6 particularly:

http://www.threshold.ie/page.asp?menu=96&page=239

gizzemoto

I will keep you all posted on how i get on, And thank you very much for all your help and advice.
Its just a kick in the b*lls when you do play fair and then find out your been screwed over, I know the lease is a binding document, But there is no harm in asking for your views and perhaps others have found themselves in this situation and find out how they got on

Emerald Lass

Afuera wrote: »

I think you should get on to Threshold and explicitly tell them that you were duped into paying above market rate and ask them what can be done about it.

Afuera, you are assuming that because the house next door is cheaper than his, his is paying above market value. That is not ncessarily the case, as the LL of the other house may actually be asking BELOW market value due to the fact that they are having difficulty getting a tenant. you can't assume that he is paying above market rate on the basis of one other house! The market is more than 2 houses - his and the other one. It is the general neighbourhood.

but on the point of the rent review, if you have not had one since you moved in then you would stand a good chance of asking for a review. you are supposed to do this at the time of signing the lease, but you may still have a shot.

another point is do you know who the LL actually is or do you only contact via the agent? I ask this as when a LL uses an agent he has to pay them a percentage of the rent (uaually betwn 5-10%). This may be why the rent is at the price it is - to cover the mortgage and the management fees to the agent. If you know who they are, contact them directly, not via the agency. Put your concerns to him/her direcly. If you have been there a year with no problems he may even forgoe the agent, meaning he can give you a cheaper rent. Also you are assuming that the agency are asking the LL for the reduction - don't trust 100% this to be true, as some agents will say the LL will not reduce the rent when they didn't even ask him. why? because if the rent goes down they loose money too. If the LL is paying 10% fee to them, they get €95, if the rent drops to €850 they get €10 less - doesn't seem much but I have heard of agents who have done this for the sake of €10! check it out

astrofool

gizzemoto wrote: »

I will keep you all posted on how i get on, And thank you very much for all your help and advice.
Its just a kick in the b*lls when you do play fair and then find out your been screwed over, I know the lease is a binding document, But there is no harm in asking for your views and perhaps others have found themselves in this situation and find out how they got on

You're not really being screwed over if you paid the market rate at the time of signing the lease.

Afuera

Emerald Lass wrote: »

Afuera, you are assuming that because the house next door is cheaper than his, his is paying above market value. That is not ncessarily the case, as the LL of the other house may actually be asking BELOW market value due to the fact that they are having difficulty getting a tenant. you can't assume that he is paying above market rate on the basis of one other house!

The OP pointed out more than one property available for less than he is currently paying. Out of interest, how would you define what the market rate is?

Emerald Lass wrote: »

This may be why the rent is at the price it is - to cover the mortgage and the management fees to the agent.

The landlord does not have the right to charge above market rate, simple as. Makes no difference whether the landlord is making a loss or not. They have the government's horrible tenancy legislation to thank for that.

Pub07

Afuera wrote: »

The landlord does not have the right to charge above market rate, simple as.

If the landlord can't charge above market rate how do rent rates ever go up? Say, if every apartment in a block is renting for €800, it would have to stay that way forever as no landlord can increase the rent without breaking the law.

Emerald Lass

Afuera wrote: »

The OP pointed out more than one property available for less than he is currently paying.

you're right Afuera, he didn't say one other property he said:

I have come across the house next door up for rent, ............ and i have also seen another house up for €775 and this is also in the same area

I still maintain that 2 houses is not a good indicator of the local market values:

As for

Afuera wrote:

Out of interest, how would you define what the market rate is?

well when threshold and PRTB still haven't figured out how to define this I would not be so presumptious to think I could define it. Ask the PRTB or a definitiion of how to assess the local market rate and see what they tell you. better to ask what is a piece of string.

In reality market rate is what renters are prepared to pay, and with the current glut this is what will determine rates not any defineable market rate.

Afuera

Pub07 wrote: »

If the landlord can't charge above market rate how do rent rates ever go up? Say, if every apartment in a block is renting for €800, it would have to stay that way forever as no landlord can increase the rent without breaking the law.

Supply and demand move the market rate.

Emerald Lass wrote: »

well when threshold and PRTB still haven't figured out how to define this I would not be so presumptious to think I could define it. Ask the PRTB or a definitiion of how to assess the local market rate and see what they tell you. better to ask what is a piece of string.

In reality market rate is what renters are prepared to pay, and with the current glut this is what will determine rates not any defineable market rate.

That's a pretty close definition of it actually. To be more exact Section 19 of the Residential Tenancies Act 2004 defines the open market rate as:
"the rent which a willing tenant not already in occupation would give and a willing landlord would take for the dwelling".

An empty property nearby advertising a lower rental rate than you are currently paying strongly suggests that there is a lack of willing tenants in the market. If you haven't had a rent review in awhile it might be time to ask for one.

321654

Afuera wrote: »

Supply and demand move the market rate.

But nobody moves the PRTB. Wasters.
op, reckon you're stuck until your lease ends.