Is the landlord within their rights to raise the rent by this much?

gnolan

As described in the title, my landlord is raising the rent. Based on my tenancy type and and the date the rent was last increased, I'm not sure if the new rent increase is allowed. The details are as follows:

Rent pressure zone: Yes
Tenancy type: Existing
Date tenancy commenced: 12/02/2016
Date previous rent set: 01/06/2018
Date new rent to take effect: 01/06/2019
Previous amount: €1463
New amount: €1521.52

So this amounts to a 4% increase. According to this my understanding is that the maximum increase allowed for an existing tenancy in a rent pressure zone is 2%/year.

In existing tenancies (starting before 24 December 2016) the first rent review in a Rent Pressure Zone may take place a minimum of 24 months from either the start of the tenancy or from the date when you were notified in writing of your last review. The maximum rent increase is 2% per year since the previous rent was set.

Am I misunderstanding this in some way?

srsly78

It says 4% per year.

gnolan

srsly78 wrote: »

It says 4% per year.

Apologies, I updated the original post with the details regarding a 2% increase per year.

wench

The RTB's calculator here agrees with the LL, €1521

https://onestopshop.rtb.ie/calculator/rpz

gnolan

wench wrote: »

The RTB's calculator here agrees with the LL, €1521

https://onestopshop.rtb.ie/calculator/rpz

I saw that, but does that not directly contradict the section on citizens information I quoted regarding existing tenancies?

Sarn

gnolan wrote: »

I saw that, but does that not directly contradict the section on citizens information I quoted regarding existing tenancies?

The initial 2% per annum only applied to the first two year period. After that it’s 4% per year.

4ensic15

A lot of people would be damn glad if their rent only went up 4%.

Subutai

gnolan wrote: »

I saw that, but does that not directly contradict the section on citizens information I quoted regarding existing tenancies?

The statutory formula is as follows:

R x (1 + 0.04 x t/m).

R is the amount of rent last set under a tenancy for the dwelling. Where the rent is being reviewed in respect of a current tenancy, ‘t’ is the number of months between the date the current rent came into effect, and the date the new reviewed rent will come into effect. Where the rent of a tenancy which existed on 24 December 2016 is being reviewed for the first time after 24 December 2016, ‘m’ is 24. In any other case, ‘m’ is 12.

So, in effect, Citizens Information are correct in that 2% is the relevant increase for the first increase in an RPZ. In your case, this is not the first increase.



However, it does look like your rent has is being reviewed too frequently, notwithstanding that your landlord does not intend for the review to come into effect until the appropriate time. To quote from Laura Farrell's recent book, Residential Tenancies:

In McMahon v Baggot Court Developments 32 the rent was reviewed by notice of rent review dated 16 July 2014, the notice said that the rent would increase ‘in 35 days from the service of this letter, that is from 20 of August 2014’. A further notice of rent review was sent dated 29 June 2015, and it said ‘in 28 days from the service of this letter, that is 29 July 2015 the new rent will accrue from this date. As your lease is due to expire on 19 August 2015 the new rent will accrue from that date. This notice is served on Wednesday 1st July 2015’.

The tenant submitted that the rent review was unlawful as it occurred more frequently than once within a period of 12 months. The landlord contended that the rent review did not occur within a 12-month period from the last rent review. The Tribunal set out the following:

The Act envisages three steps involved in the increasing, by a landlord, of the rent payable under a tenancy. These are:

‘First, the landlord must engage in a procedure (however described) for determining whether and to what extent the rent should be increased. This is the “review of a rent” within the meaning of the Act as provided for in s 24(2)(a) of the Principal Act.

Secondly, at least 28 days before the date from which the new rent is to have effect, the landlord must serve a “notice in writing” on the tenant, stating the amount of the new rent and the date from which it is to have effect. This is prescribed in s 22(2) of the Principal Act.

Thirdly, the “setting of a rent” pursuant to the review of rent. This, according to s 24(3) of the Principal Act, refers to:

(a) the oral agreeing of the rent;
(b) the oral or written notification of the rent, or
(c) where the lease contains a provision whereby on the happening of an event the increase in rent shall have effect, the rent set pursuant to that provision …’


The Tribunal went on to say:

‘[t]wo things are clear from the foregoing: first, a “rent review” within the meaning of the legislation involves a decision-making process that takes place prior to the notification in writing of the new rent; second, that “rent review” cannot take place more frequently than once in every 12-month period.’

In the present case, the Tribunal found that:

‘[n]o evidence was given as to when this decision-making process occurred. Having regard to the dates on which notices sent on foot of these rent reviews, the rent review in 2014 took place at some point prior to 16 July 2014 and the rent review in 2015 took place at some point prior to 29 June 2015.’

In the absence of any evidence as to when the decision-making process occurred, the Tribunal had to decide when the process took place and held that it was:

‘satisfied that the rent reviews that occurred prior to the sending of these notices, on the balance of probabilities, occurred within, at most, two weeks of the notices being sent.’

The Tribunal does not rule out the possibility that there could potentially be a longer time lag than two weeks between the process of rent review and the service of the notice, but only note that there would need to have been actual evidence to establish this. Having made the decision that the rent review process which precipitated the notice sent on 29 June 2015 occurred less than 12 months after the rent review which precipitated the notice sent on 16 July 2014, the Tribunal concluded that the notice was unlawful.

gnolan

Appreciate that @Subutai. I've obviously misunderstood the information provided on citizens information - although I do think it's a little ambiguous. Thanks again.

UpTheSlashers

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

4ensic15

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

Why wouldn't they?

daheff

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

if they round down, they lose out on an even bigger raise the next time.

pwurple

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

They are almost obligated to do it this way.

padser

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

Sure the landlord isn't being allowed to charge market rent for his property.

I assume his bank charges him the market interest rate. I assume the tax man charges him the appropriate tax.

Why on earth would he not try and get the measily few percent he is allowed?

overkill602

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

I think greed cuts both ways, but next years property tax increase will take it back off him

Browney7

4ensic15 wrote: »

Why wouldn't they?

The 52 cent? Really? 6 quid a year or three euro after tax? Would you actually be bothered?

ELM327

Browney7 wrote: »

The 52 cent? Really? 6 quid a year or three euro after tax? Would you actually be bothered?

On a point of principle, yes.

amcalester

ELM327 wrote: »

On a point of principle, yes.

Principle and I think landlords are afraid of deviating from the prescribed process in case the RTB decide against them in a future case.

Browney7

Browney7 wrote: »

The 52 cent? Really? 6 quid a year or three euro after tax? Would you actually be bothered?

Would you throw 3 euro change in the bin while leaving a shop?

Would you accept a wage from your employer that was 3 euro short?

I wouldn’t and neither would anyone who values Money.

Browney7

Malia Bald Sleeper wrote: »

Would you throw 3 euro change in the bin while leaving a shop?

Would you accept a wage from your employer that was 3 euro short?

I wouldn’t and neither would anyone who values Money.

Good for you Nox!

Claw Hammer

Browney7 wrote: »

The 52 cent? Really? 6 quid a year or three euro after tax? Would you actually be bothered?

Why doesn't the tenant pay an extra 48 cent of they don't want to pay an odd amount?

Browney7

Claw Hammer wrote: »

Why doesn't the tenant pay an extra 48 cent of they don't want to pay an odd amount?

Ah sure you couldn't have the landlord being dragged over hot coals in front of the RTB now could we.

No irrational fear of unrounded numbers here. I'd pay whatever they asked by just updating the standing order anyways (provided the LL doesn't insist on cash) but still think it's either an automated letter or they are just miserable really. LL would be some laugh splitting a bill at dinner I'd say. Each to their own though

Gas thread really, the OP got some good advice.

Graham

I doubt most landlords give the few cents anything like as much thought as some of the posters in this thread. :rolleyes:

The reality will be something like this

1) RTB calculator
2) Copy
3) Paste

Job done

Dav010

If ever a thread sums up the difficulty with being a LL, this is it. Even when the letter of the law is followed, some still find cause for complaint.

Always Tired

Dav010 wrote: »

If ever a thread sums up the difficulty with being a LL, this is it. Even when the letter of the law is followed, some still find cause for complaint.

Yes, landlords are required by law to raise the rent.

Dav010

Always Tired wrote: »

Yes, landlords are required by law to raise the rent.

No, they are required to abide by the law when they raise the rent. This landlord did just that, to the cent.

UpTheSlashers

padser wrote: »

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

Sure the landlord isn't being allowed to charge market rent for his property.

I assume his bank charges him the market interest rate. I assume the tax man charges him the appropriate tax.

Why on earth would he not try and get the measily few percent he is allowed?

"Market Rate" is misleading term. Rent prices are only rising because vested interests such as landlords are suppressing the development of supply to meet demand.

Greed does not cut "both ways" in these circumstances.

4ensic15

UpTheSlashers wrote: »

"Market Rate" is misleading term. Rent prices are only rising because vested interests such as landlords are suppressing the development of supply to meet demand.

Greed does not cut "both ways" in these circumstances.

How are landlords depressing supply? Tenants were well able to bargain rent down when there was a glut of available rentals as evidenced on this forum. The only way landlords are depressing supply is by selling out. Selling out means they get no rent at all, not a higher rent.

Dav010

UpTheSlashers wrote: »

"Market Rate" is misleading term. Rent prices are only rising because vested interests such as landlords are suppressing the development of supply to meet demand.

Greed does not cut "both ways" in these circumstances.

Interesting, I would have thought like of supply would be mostly due to the fact that for 10 years there was no property development. I can’t see myself how landlords, and don’t forget the majority are single property owners, suppressed the development of supply. I certainly didn’t stop the banks from lending to developers.

Greed certainly does cut both ways, tenants looked for reductions during the recession and cared little if the LL was struggling to make repayments while supply outstripped demand, LL’s care little about raising rents when demand outstrips supply.

ted1

UpTheSlashers wrote: »

It's really telling that they didn't just raise it to a round figure, but want every last cent they can get.

Its a business. Not a charity

ted1

UpTheSlashers wrote: »

"Market Rate" is misleading term. Rent prices are only rising because vested interests such as landlords are suppressing the development of supply to meet demand.

Greed does not cut "both ways" in these circumstances.

Tin foil hat ^^^