Tenants indicate they are not going to move

The_Conductor

Posted on behalf of a user who would rather remain anonymous.
Please offer reasonable, legal, and pertinent advice to the poster.

Back in the boom the (now wife) bought a 3 bed semi with another partner.
As things transpired the relationship broke down the house landed in negative equity with other party emigrating temporarily and washing their hands of the affair.

The property has an extremely competitive tracker attached to it.

A few years pass and the wife has looked after the payments & maintained the property before eventually letting it out to a good family of tenants.
The other party had refused to engage in the payment of the following
House insurance
Maintenance fees
Property Tax
Upkeep & repair of the house.
PRTB / rental fees

As a result of this many of these fees went unpaid.
The other party has recently agreed to foregoing his interest in the property and this has been recently legally transferred over to me.
I'm happy with this as the property is now coming out of negative equity.

Now, here's where it gets complicated.

The house has been let out since summer 2014. We drew up a lease for the tenants and renewed it summer 2015. They asked to renew the lease for 2016 but we alerted them that this was not possible and shortly afterwards informed them in writing of our intention to move into the house after the legal notice period has expired.

At the time the house was not let through the PRTB.....

My questions are as follows,
1. Would it now/still be possible for us to register with the PRTB as landlords due to the recent change in the house ownership.

2. What course of action can be taken by us if there is a difficulty/refusal with the tenants in vacating the property.

We intend to sell the house in the short to medium term after moving in to relocate.
I don't really forsee an issue, just want to be prepared should the situation arise!

cerastes

Consider assisting the tenants voluntary move to facilitate a speedy process that may cost less and be quicker in the long run than waiting on a PRTB decision.
The only official advice can be, register with the PRTB, pay the late fee (look it up first).
Give the tenant their notice to quit based on moving back in as the primary residence, this could be the primary residence of either person or both I would imagine.
again,
Consider assisting the tenants voluntary move to facilitate a speedy process that may cost less and be quicker in the long run than waiting on a PRTB decision.

Failing any cooperation of the tenant to abide by the notice, take a case to the PRTB, expect delays and potential penalties,
and lastly, dont rent again, prohibitive regulations make it unviable.

The_Conductor

Definitely register with the Residential Tenancies Board (it changed its name recently)- aside from any other reason- from 2015 onwards- mortgage interest is not an allowable cost (at 75% of course) before determination of taxable rental income- unless the tenancy is registered with them.

I'd be inclined to agree with Cerastes- if you do intend to use the property yourself in the immediate future- and sell in the short to medium term- do not relet the property- under any condition- once you manage to persuade the current tenants to leave.

If you do intend to live in the property- talk to a tax consultant- it may be better from a tax perspective to live there for specific period of time (if the property has eventually exited negative equity and you have some funds in it).

First off- register the tenancy- pay the late fee- do it asap- aside from anything else- you'll need it registered to do your 2015 tax return.

cerastes

Id consider registering it in the new owners name, plus I dont think your wifes name would even have to be on the new lease, they might know she and you are together, it just indicates a change of circumstances of who they are dealing with and it is still legitimate (but doesnt limit their rights to tenure).
You wanting to move back in does limit their rights to tenure,
to avail of these rights you need to either have them willingly leave and terminate the contract by mutal consent, however you may encourage them of that voluntarily, Id get their voluntary agreement to this signed in writing.
or
register with the RTB and take a case.

Id talk with the tenants first, they may be digging their heels in thinking this will go away if they hold out, you may be able to persuade them it could be in their interest?? and that might be quicker than going the RTB route, they may simply not be able to move financially or may have children in school locally.

that said, the official route is the only one that gives full protection, but not necessarily the preferred result. Id start the ball rolling now and see how the tenants respond first, once they know the end result will be the same they may yield and it may even be to their advantage, but that would depend on what the persuasion was, Id keep a record of any persuasion. If in anyway its that they wont budge under any circumstances, then Id register and proceed that route. But legally you should be registered.

So, you could register, and let them play out their 4 years entitlement, although that seems less likely for you as you need the property and want to sell. Its much easier to prepare for that being there as there is no organising of work when a tenant is present or inconvenineces around that.
if you wnet that route, when the 4 years approaches (in 2 years time), give the required notice in advance so that they are out the door the day after the lease expires. But they might consider they have won once already, they may decide to hold out again and it could take a further 2 years to remove them, which is too much out of someones life to entertain.
If holding on the 4 years, Id hit them with the max possible increase in rent now (after 2 years) and make records that proves the rent increase is realistic (screenshots of daft etc).
Its always on thin ice if not registered and the tenant gains advantage, approach them, but do nothing formal unless registered.

Be wary of saying anything to the bank or anyone regarding the tracker.

4ensic15

Was your wife married to the previous partner at the time of the purchase of the house. If so did the former partner consent in writing to the letting?

cerastes

4ensic15 wrote: »

Was your wife married to the previous partner at the time of the purchase of the house. If so did the former partner consent in writing to the letting?

I dont think thats the main thrust of the problem now, they checked out and now have formally given consent and assigned responsibility elsewhere, the issue at hand is a completely different thing. As background information, it may even not have been relevant as its done and dusted now.

4ensic15

cerastes wrote: »

I dont think thats the main thrust of the problem now, they checked out and now have formally given consent and assigned responsibility elsewhere, the issue at hand is a completely different thing. As background information, it may even not have been relevant as its done and dusted now.

If it was once a family home the letting would be void if the consent of both spouses was not given. It would be a much faster route to achieving possession than the RTB and would avoid the need to register.

cerastes

4ensic15 wrote: »

If it was once a family home the letting would be void if the consent of both spouses was not given. It would be a much faster route to achieving possession than the RTB and would avoid the need to register.

I would not be convinced that would limit the tenants rights or speed the process, even if they had not assigned righst by now. But they have now assigned the legal obligations on another person, so I think it would just be a dead end.
Personally I think try persuade them, by some means, that will be beneficial to them, if it benefits them and they agree, then it benefits the people that own the house, record this as in a signed statement of mutal consent.
after that, the only option is an RTB route.

4ensic15

cerastes wrote: »

I would not be convinced that would limit the tenants rights or speed the process, even if they had not assigned righst by now. But they have now assigned the legal obligations on another person, so I think it would just be a dead end.
Personally I think try persuade them, by some means, that will be beneficial to them, if it benefits them and they agree, then it benefits the people that own the house, record this as in a signed statement of mutal consent.
after that, the only option is an RTB route.

The lease would be void if it was in breach of the family Home Protection Act 1976. The tenants would have no rights. they could be thrown onto the road in the morning.

Marcusm

4ensic15 wrote: »

The lease would be void if it was in breach of the family Home Protection Act 1976. The tenants would have no rights. they could be thrown onto the road in the morning.

I'd love to see the decision of a judge when presented with victims proceedings by a property owner which was claiming her own failure to abide by the Family Home Protection Act as justification to void a statutory tenancy. I suspect the case would be adjourned on multiple occasions.

nompere

The_Conductor wrote: »

Definitely register with the Residential Tenancies Board (it changed its name recently)- aside from any other reason- from 2015 onwards- mortgage interest is not an allowable cost (at 75% of course) before determination of taxable rental income- unless the tenancy is registered with them.

The requirement to be registered with RTB (previously PRTB) has actually applied since 1 January 2006 - it was inserted into S.97 Taxes Consolidaton Act 1997 by S.11(1) Finance Act 2006.

The_Conductor

nompere wrote: »

The requirement to be registered with RTB (previously PRTB) has actually applied since 1 January 2006 - it was inserted into S.97 Taxes Consolidaton Act 1997 by S.11(1) Finance Act 2006.

Correct- they only started sharing data with the Revenue Commissioners (giving them a straight wsdl link into their database) last November though (previously- while it was the law- it wasn't enforced).

4ensic15

The_Conductor wrote: »

Correct- they only started sharing data with the Revenue Commissioners (giving them a straight wsdl link into their database) last November though (previously- while it was the law- it wasn't enforced).

It was enforced. If the revenue did an audit and found tenancies unregistered and the allowance had been claimed they disallowed the allowance and applied interest and late penalties with regard to the sums which had been wrongly claimed.

newacc2015

The poster needs to realise if they were audited in the morning. The first thing revenue will ask for is there RTB registrations. Without them and if you were claiming mortgage interest relief, you can expect a massive tax bill if you have relatively high interest rate. The poster can register with the RTB tomorrow

My suggestion would be sit down and explain the situation. Explain to them, the RTB might the case within 6 weeks and they will have extreme difficulty finding a house in this market with no references. If they are refusing to leave, I would offer them €1k-2k to get out of the property quickly. It might seem extreme, but it is better than dealing with the RTB etc. If they were refuse the money, immediately file with the RTB. You might spend the money and get a legal letter from one of the big five to show them you are serious about evicting them. Most rental contracts arent worth the paper they are written on, but they still frighten a majority of tenants into fulfilling their obligations

I would stop calling them and start putting everything in text or email. You need to build a paper trail