PRTB registration

kdowling

I have recently brought a house which has a cottage on the land which was rented.
The landlord was charging well below market rent and in return the tenant looked after the grounds and did other jobs.
The tenant was moved on when the house was sold.
My worry now is that I will only be able to put the rent at 4% higher than the previous rent which wouldn’t be even worth renting it for.
Is there any exemptions or work around for this type of scenario?.

dennyk

You have a few potential concerns here.

- Does this "cottage" actually have proper planning permission to be rented out as a residence? If it was built or restored without planning permission, it would not be considered a habitable dwelling and can't be rented out for such purposes.

- Does it meet the minimum standards for a rented property? If not, it cannot be rented out until it has been brought up to standard.

- Is the dwelling actually in an RPZ? You can enter the Eircode in the RTB's calculator to verify. If it is in an RPZ, then yes, you are restricted to the 4% per year increase (soon to be much less than 4% per year going forward, as it will be indexed to inflation). Good news is that it is 4% per year (at least at the moment), not just 4% from the time the rent was last set; if it was set a few years ago, you might be able to increase the rent by a fair bit more. The above calculator will tell you exactly.

There are exemptions to the RPZ regulations, but they are fairly strict. Basically, your options would be to take it off the rental market for at least two years, or make a substantial change to the nature of the dwelling (and this means very substantial; a combination of building an extension, adding rooms, and/or significantly improving the BER rating, not just giving it a lick of paint and some new flooring...). You must inform the RTB of the justification for your exemption if you plan to avail of one.

Claw Hammer

Was the letting registered with the RTB? it seems the old tenant was a quasi- caretaker.

kdowling

Claw Hammer wrote: »

Was the letting registered with the RTB? it seems the old tenant was a quasi- caretaker.

Yes it was registered.
I actually called the PRTB today who said I would unlikely have any problems if I rented it at market rates as it’s normally a tenant that alerts the PRTB to increase above 4%
I asked would their system not automatically flag an increase greater than 4% but he said the system was not that Sophisticated.
I’m not sure if quoting this advise would hold up if investigated.
Strange advise to receive from the PRTB themselves.

Claw Hammer

kdowling wrote: »

Yes it was registered.
I actually called the PRTB today who said I would unlikely have any problems if I rented it at market rates as it’s normally a tenant that alerts the PRTB to increase above 4%
I asked would their system not automatically flag an increase greater than 4% but he said the system was not that Sophisticated.
I’m not sure if quoting this advise would hold up if investigated.
Strange advise to receive from the PRTB themselves.

I heard a story yesterday about someone who is being investigated by the RTB for letting a formerly tenanted property too much above the old rent.

dennyk

kdowling wrote: »

I’m not sure if quoting this advise would hold up if investigated.

It absolutely would not. "But you said you probably wouldn't find out if I break the law!" is not a defense against breaking the law. Legally you must advise the new tenant in writing of the rent that the previous tenant was paying and explain to them why the rent you're going to be charging them is allowed under RPZ regulations on that basis, as well, so if you are overcharging them, they will know it (unless you also break that law as well by lying to them or neglecting to provide that information, of course, but you're not going to be that sort of landlord...right?).

Look at it this way; even if the rental income you're getting out of the place isn't the theoretical maximum possible market rate, it's still some extra income just from renting out a spare cottage on your new land that you're not using yourself. And again, remember that it's not 4% above the last rent, it's 4% per year since the last time the previous rent was set, so be sure to take that into account with your calculations.