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Reduce rent for friend?

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  • 19-11-2020 5:18pm
    #1
    LegacyUser
    Registered Users Posts: 166,026 ✭✭✭✭


    My story is that I bought an apartment a couple of years ago and an opportunity arose to rent out a room to a friend. I had looked at the going rate in the area and said I would knock about €100 off what I was planning on charging a stranger.

    I recently checked what similar rooms are being advertised for on daft and they've dropped a bit. Along the lines of €50-€100. So it ends up that I'm now charging my friend the going rate for a room.

    I'm not sure if he knows I was giving him a "mates rate" as I never explicitly said it so he might just think I'm charging the going rate. He might not even know that rents have dropped in the area either. I have asked him a few times if he was happy with what he was paying and he said he was, but I guess that response is always to be expected out of politeness.

    Another factor at play are that he has taken a 10% salary cut due to covid and I haven't, which I think he knows.

    To cut a long story short, should I offer to drop the rent to keep the "mates rate" going or just leave well enough alone?


Comments

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    #2
    Pyr0
    Registered Users Posts: 5,967 ✭✭✭Pyr0


    Personally, I'd feel better dropping the rent for a friend if I didn't need the money.


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    #3
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    If you don't need the money, it would be a nice thing to do.


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    #4
    Sonic the Shaghog
    Registered Users Posts: 606 ✭✭✭Sonic the Shaghog


    If you can afford it and are happy do it, do it.

    Can I just say the fact even tho he's your friend you're a good person not only giving cheaper rent but the fact you are looking at bringing it down again under the current levels fair play to you it stands to you


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    #5
    Dial Hard
    Registered Users Posts: 13,413 ✭✭✭✭Dial Hard


    Tbh, I always think rent-a-room should be a bit under the going rate for a similar property in the area anyway; living with an owner is a very different dynamic than renting, with no rights to boot and I do think the price should reflect that. Mates rates would be secondary to that for me.

    I'd offer him a 10% reduction in the rent to reflect his salary cut at the very least. Assuming you can absorb it with no hardship, obvs.


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    #6
    Tork
    Registered Users Posts: 3,273 ✭✭✭Tork


    Can you afford to cut it? More to the point, are you comfortable with approaching him in the future and increasing it again?


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    #7
    accensi0n
    Registered Users Posts: 2,745 ✭✭✭accensi0n


    Sonic the Shaghog wrote: »
    If you can afford it and are happy do it, do it.

    Can I just say the fact even tho he's your friend you're a good person not only giving cheaper rent but the fact you are looking at bringing it down again under the current levels fair play to you it stands to you

    +1 to this.

    The fact that you're thinking about it and it sounds like your leaning towards doing, I would suggest just go ahead and do it soon. If you leave it a few months and then do it you might have a bit of regret that you didn't do it sooner.
    Fair play to ya.


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    #8
    jelly&icecream
    Registered Users Posts: 477 ✭✭jelly&icecream


    ILoveYourVibes wrote: »
    Whatever you decide just know ...you can't just hike up rent again to what it was once you drop it ..

    It would be illegal you can only increase it by 4% per annum ..is er ..20? Im not good at maths.

    If this is a rent a room situation where the OP lives in the house they own and rents out the spare room then these restrictions don't apply.


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    #9
    jelly&icecream
    Registered Users Posts: 477 ✭✭jelly&icecream


    ILoveYourVibes wrote: »
    OP ..if you said this is what i am charging you ...and you didn't make him aware it was a lowered rate and to expect a hike. I don't think you have the right to higher it. It would seem very wrong to me.

    If you had laid out an agreement in the beginning ..i charge you this for 6 weeks and then you pay more. Perhaps. But you are raising and its unexpected.

    I dont think this is proper or fair.

    The poster is wondering if they should reduce the rent, not raise it? Your post is not very coherent tbh.

    OP, I'm presuming you get on well with your licensee and they are a good housemate. It would certainly be a nice gesture to knock 50 quid off.

    Are you relatively financially comfortable so that it wouldn't strain your finances? How reliant are you on having the rent a room income. Would be be comfortable renting the room to a stranger if your housemate moved out? These are the kind of questions you need to ask yourself.


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    #10
    Eleven Benevolent Elephants
    Banned (with Prison Access) Posts: 426 ✭✭Eleven Benevolent Elephants


    ILoveYourVibes wrote: »
    Whatever you decide just know ...you can't just hike up rent again to what it was once you drop it ..

    It would be illegal you can only increase it by 4% per annum ..is er ..20? Im not good at maths.

    So its like ....um ..not going to be possible maybe for you to just put it back at what it was before your friend moved in when they move out.

    I think the rent increase cap is due for a revue in 2021 in december .....but i wouldn't expect it to change drastically.


    My advice to you would be to be aware of how the cap will affect your ability to bring the rent up to what it was before ...after your friend is gone. And then make a decision.

    Obv check i haven't made any mistakes and that is STILL is 4% per annum in dublin etc. I could be wrong.

    You can't just increase the rent by 100 like that in one go ...theoretically it would take 5 years for you to get it back up to where is now. That might not be wise for you.

    What???? :confused:

    He's leasing a room, not the whole apartment.

    RPZ doesn't apply here, RPZ doesn't even apply in most of Ireland.


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    #11
    Eleven Benevolent Elephants
    Banned (with Prison Access) Posts: 426 ✭✭Eleven Benevolent Elephants


    ILoveYourVibes wrote: »
    True they don't have a tenancy agreement then in this case they have a licensee one.

    The 'tenant' has much fewer rights in this case.

    There was talk of bringing in legislation ..but then covid so nothing.

    But the OP has to live there and the room he is renting can't be self contained etc

    OP ..if you said this is what i am charging you ...and you didn't make him aware it was a lowered rate and to expect a hike. I don't think you have the right to higher it. It would seem very wrong to me.

    If you had laid out an agreement in the beginning ..i charge you this for 6 weeks and then you pay more. Perhaps. But you are raising and its unexpected.

    I dont think this is proper or fair.


    You say you never said ...this was a lower rate ....and it was to be raised. Its like saying 'oh yeah i didn't really tell you it was REALLY this price'.

    You agreed upon what you agreed upon.

    It's the OP's property.

    S/he can charge as they see fit. Socialist drivel.


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    #12
    Tork
    Registered Users Posts: 3,273 ✭✭✭Tork


    OP, I'm old enough to remember the aftermath of the 2008 property crash. That's why I'm advising you to hold your fire. Back then, people had to take pay cuts and tax increases in order to keep the books relatively balanced. None of us knows the full extent of what Covid will do to the jobs market here.


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    #13
    ILoveYourVibes
    Registered Users Posts: 15,176 ✭✭✭✭ILoveYourVibes


    jelly&icecream wrote: »
    The poster is wondering if they should reduce the rent, not raise it? Your post is not very coherent tbh.

    .
    I had assumed that was what he was asking ...apologies


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    #14
    ILoveYourVibes
    Registered Users Posts: 15,176 ✭✭✭✭ILoveYourVibes


    Eleven Benevolent Elephants wrote: »
    What???? :confused:

    He's leasing a room, not the whole apartment.

    RPZ doesn't apply here, RPZ doesn't even apply in most of Ireland.
    This wasn't clear from his post. I thought he was renting out rooms in an apartment not living there himself.


    OP ...do what you feel is the right thing to do.


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    #15
    ILoveYourVibes
    Registered Users Posts: 15,176 ✭✭✭✭ILoveYourVibes


    Eleven Benevolent Elephants wrote: »

    RPZ doesn't apply here, RPZ doesn't even apply in most of Ireland.
    It does in a lot of dublin.

    I for example am subject to it.


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    #16
    Tork
    Registered Users Posts: 3,273 ✭✭✭Tork


    OP is renting out a room. Completely different thing.


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    #17
    Eleven Benevolent Elephants
    Banned (with Prison Access) Posts: 426 ✭✭Eleven Benevolent Elephants


    ILoveYourVibes wrote: »
    It does in a lot of dublin.

    I never said otherwise.


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    #18
    LegacyUser
    Registered Users Posts: 166,026 ✭✭✭✭LegacyUser


    So I just found out that his pay was restored a few months ago and has been offered a raise! I don't know if that affects things now. I kind of feel bad for second guessing myself about reducing the rent.

    I could of course afford to reduce what I'm charging him. I bought the place knowing that there may be a day where I won't be able to rent out a room because of a downturn so I made sure I could afford the mortgage repayments without it.

    Saying that, when I was buying the apt I did intend to rent out the room to a stranger so that I could pay off as much of my mortgage while I can, and if there was a recession and the room was idle, at least my repayments wouldn't be as severe.

    What do people normally do in these situations? I'm sure I'm not the only person to rent a room to a friend.


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    #19
    suicide_circus
    Registered Users Posts: 19,802 ✭✭✭✭suicide_circus


    Tork wrote: »
    OP, I'm old enough to remember the aftermath of the 2008 property crash. That's why I'm advising you to hold your fire. Back then, people had to take pay cuts and tax increases in order to keep the books relatively balanced. None of us knows the full extent of what Covid will do to the jobs market here.

    This. There are hard times ahead.


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    #20
    suicide_circus
    Registered Users Posts: 19,802 ✭✭✭✭suicide_circus


    rentreducer wrote: »
    So I just found out that his pay was restored a few months ago and has been offered a raise! I don't know if that affects things now. I kind of feel bad for second guessing myself about reducing the rent.

    I could of course afford to reduce what I'm charging him. I bought the place knowing that there may be a day where I won't be able to rent out a room because of a downturn so I made sure I could afford the mortgage repayments without it.

    Saying that, when I was buying the apt I did intend to rent out the room to a stranger so that I could pay off as much of my mortgage while I can, and if there was a recession and the room was idle, at least my repayments wouldn't be as severe.

    What do people normally do in these situations? I'm sure I'm not the only person to rent a room to a friend.

    He's happy with the rent. Leave it there.


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    #21
    Tork
    Registered Users Posts: 3,273 ✭✭✭Tork


    Have you said anything to him about reducing his rent? I'm a bit confused now.


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    #22
    Ellie2008
    Registered Users Posts: 1,123 ✭✭✭Ellie2008


    rentreducer wrote: »
    So I just found out that his pay was restored a few months ago and has been offered a raise! I don't know if that affects things now. I kind of feel bad for second guessing myself about reducing the rent.

    I could of course afford to reduce what I'm charging him. I bought the place knowing that there may be a day where I won't be able to rent out a room because of a downturn so I made sure I could afford the mortgage repayments without it.

    Saying that, when I was buying the apt I did intend to rent out the room to a stranger so that I could pay off as much of my mortgage while I can, and if there was a recession and the room was idle, at least my repayments wouldn't be as severe.

    What do people normally do in these situations? I'm sure I'm not the only person to rent a room to a friend.

    OP you gave your friend a mates rate. If he has any issue with the rent let him bring it up. He’s already had the advantage of €100 saving a month for a period. It seems his financial situation is good. You’re not screwing him. If rents had dropped massively that would be different. Based on what I hear elsewhere I’m surprised they’ve dropped at all.


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    #23
    bertiebomber
    Registered Users Posts: 728 ✭✭✭bertiebomber


    Nope the rent is the rent, when you have to allow a person to live in your space in order to afford the mortgage they should pay the whole rent . Bad enough having to share the space. I hated doing this and down sized to avoid having to ever again . Most people are nice but when you live with them they become pestilent. Try putting the rent back to normal after the crisis, wont happen and friendship will suffer.


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    #24
    Tork
    Registered Users Posts: 3,273 ✭✭✭Tork


    If you went ahead and reduced his rent since you started the thread, all you can do is live with the consequences of your choice. Not everybody here was advising you to reduce the rent at the time. It isn't entirely clear from your update what you chose to do.

    Your friend isn't obligated to keep you updated as to his finances. By all means, increase the rent again if you want but it'll probably sour your friendship. I have seen friendships end once people moved into shared accommodation. It is the risk you run once you enter into these sort of arrangements. In the grand scale of things, your friend will be renting from you for a fraction of the duration of your mortgage. You have told us you can afford to pay the mortgage anyway, even without somebody living with you. Which is more important to you? Extra rent money or a friendship.


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    #25
    Thelonious Monk
    Registered Users Posts: 13,895 ✭✭✭✭Thelonious Monk


    I used to rent my spare room to a friend, for 80 euro a week, until last year. I know it was peanuts but he wasn't home that much and he wasn't exactly raking in cash. I never asked for a raise but then he just started giving me 100 a week I think because he thought it was too little. Eventually he moved out and now I wouldn't bother renting the room out to anyone.
    Anyway it's really up to you and what you think is fair, I would always charge less as you are the owner and because it's a friend.


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    #26
    woodchuck
    Moderators, Society & Culture Moderators Posts: 15,409 Mod ✭✭✭✭woodchuck


    OP I think your heart is in the right place, but I'd leave well enough alone. You offered him a reduced rate at the time, which he was happy with and presumably still is.

    The economy, rent rates, your finances and your friends finances are all naturally going to fluctuate over time. It wouldn't be practical to change the rent every time one of these variables changes. And as it has transpired, you weren't fully aware of your friends actual financial situation anyway (and to be frank, it's not really any of your business, unless he can't pay the rent).

    It would be different if your friend was in financial trouble and approached you about not being able to afford the rent, but that's not the case here.


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    #27
    iano.p
    Closed Accounts Posts: 817 ✭✭✭iano.p


    I had a similar situation when I lived in Dublin back around 08. I didn't need his rent it was just having someone in the spare room. My friends wage had been cut but reinstated a short time later. He was happy with what he was given me so I never lowered the rent but each Christmas and his birthday I always left him off paying it that worked for me and I moved back home and he stayed renting the whole place for a few years.


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    #28
    Katgurl
    Registered Users Posts: 2,143 ✭✭✭Katgurl


    I wouldn't expect cheaper rent in your friend's shoes. I've been in his situation and she charged me the top of the market rate. That was fine as, like you she would have been taking a tenant regardless.

    In fact, she then increased my rent by 25% three months after I moved in. I paid it but I was quite upset, I had changed careers and had only been able to get part-time hours so was scrabbling round for extra work already. As we had no lease I kept an eye on daft, then when a much bigger, better located place appeared for a fraction of the rent I took it.

    Writing all that down I'm surprised but pleased to report we are still great friends.


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    #29
    Rachiee
    Registered Users Posts: 880 ✭✭✭Rachiee


    I wouldn't, one thing to consider is you're never going to raise it on him so when rents go back up he will be on mates rates anyway, other issue is if you ever find yourself stuck for money , you'll look at him and think it's costing you about 100 a month to rent to him and you could build resentment. Just charge going rate and you are both benefitting anyway from not living with strangers


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    #30
    mud
    Registered Users Posts: 2,699 ✭✭✭mud


    I agree that you should leave the rent as it is but kudos for considering the reduction in the first place.

    I rented from friends for a while and the price kept creeping up because one of the couple decided to give up work so I was seen as the handy ATM.

    We are no longer friends.


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