Rent setting for a new tenancy in a Rent Pressure Zone (RPZ)
A Rent Pressure Zone (RPZ) is a designated area where rents can only be increased by up to 4% annually. Certain rules must be followed for setting and reviewing rents in RPZs:
- In Rent Pressure Zones rents can only rise by up to 4% annually. This limitation is in place for a maximum of three years and applies when rents are set at the start of a tenancy and when rents are reviewed during an ongoing tenancy. To find out if your property or tenancy is in a Rent Pressure Zone, please use our Rent Calculator.
- A landlord must tell the tenant what the amount of rent that was last set under the tenancy for the dwelling,
- A landlord must provide the date the rent was last set under a tenancy for the dwelling.
- A landlord must provide a statement as to how the rent set under the tenancy of the dwelling has been calculated having regard to the Rent Pressure Zone formula.
- The rent set for the property must be in line with local market rents for similar properties, and three examples of rents for comparable properties must be used to show this.
How is the rent calculated?
The RPZ Rent Calculator is a useful tool to calculate the maximum allowable rent in an RPZ area.
If a landlord is setting the rent in a Rent Pressure Zone, the amount can not be greater than the amount determined by the formula below.
The Rent Pressure Zone Formula
Comparable market rents
Rent cannot be set above the local market rents for similar properties in the area and three comparable examples for similar properties in the locality must be presented to demonstrate this. The landlord must include the rent amount for three comparable dwellings of a similar size, type and character and situated in a comparable area with similar terms in the agreement to establish market rent. See sample notices of rent reviews here.
Evidence of the rent charged for comparable properties can be in the form of advertisements for such properties published within the previous four weeks. If a tenant considers that they are being asked to pay more than the market rent, they can seek clarification from the landlord or take a dispute case to the RTB within 28 days of receipt of receiving noitce of the rent change.