Setting the Rent in a Rent Pressure Zone

Certain restrictions apply to new tenancies in a Rent Pressure Zone

Setting the rent at the commencement of a new tenancy within a Rent Pressure Zone. 

In the case of a new tenancy in a Rent Pressure Zone, unless the property is exempt from the RPZ rental restrictions a landlord is required to furnish the tenant, in writing, with the following information at the commencement of the tenancy:

  • The amount of rent that was last set under a tenancy for the dwelling,
  • The date the rent was last set under a tenancy for the dwelling, and
  • 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.

Additionally the 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.

When a tenancy ends within a Rent Pressure Zone and new tenants move in to the rented dwelling, landlords must adhere to the RPZ formula and cannot set the rent for the new incoming tenants to market levels. All landlords when setting the rent on a new tenancy within a Rent Pressure Zone must show their new tenants, on or after the commencement of the tenancy, how the rent was set in accordance with the Rent Pressure Zone formula. Landlords should use the handy RPZ Calculator tool when setting the rent to ensure they do so in accordance with the law. Landlords can also print out the RPZ Calculator findings to show to their new tenants.

Setting the rent at the commencement of a new tenancy within a Rent Pressure Zone, when relying on an exemption.

It is important to remember that not all properties in RPZs are subject to the 4% restriction. Exempt properties include properties that have not been rented for a period of two years prior to the immediate tenancy commencement date, and those that have undergone a 'substantial change in the nature of the accommodation'. All landlords when setting the rent on a new tenancy within a Rent Pressure Zone must show their new tenants, on or after the commencement of the tenancy, how the rent was set. This also applies where a landlord is relying on an exemption and landlords should provide as much information as possible to their new tenants.

There have been recent changes to the legislation surrounding the exemption rules and criteria which substantial change must meet. 

Exemption 1: The initial setting of the rent on a dwelling which had not been rented for a period of two years prior to the immediate tenancy commencement date. All rent reviews thereafter must adhere to the Rent Pressure Zone formula.

Exemption 2: A 'substantial change' in the nature of the accommodation has been defined and will only be deemed to have taken place where strict criteria is met. 

the works carried out to the dwelling concerned - 

(i) consist of a permanent extension to the dwelling that increases the floor area (within the meaning of Article 6 of the Building Regulations 1997 (S.I. No. 497 of 1997)) of the dwelling by an amount equal to not less than 25% of the floor area (within such meaning) of the dwelling as it stood immediately before the commencement of those works, 

or

(ii) in the case of a dwelling to which the European Union (Energy Performanceo of Buildings) Regulations 2012 (S.I. No. 243 of 2012) apply, result in the BER (within the meaning of those Regulations) being improved by not less than 7 building energy ratings, 

or any 3 or more of the following:

  • the internal layout of the dwelling being permanently altered;
  • the dwelling being adapted to provide for access and use by a person with a disability, within the meaning of the Disability Act 2005;
  • a permanent increase in the number of rooms in a dwelling; 
  • in the case of a dwelling to which the European Union (Energy Performance of Buildings) Regulations 2012 (S.I. No. 243 of 2012) apply and that has a BER of D1 or lower, the BER (within the meaning of those Regulations) being improved by not less than 3 building energy ratings; 
  • in the case of a dwelling to which the European Union (Energy Performance of Buildings) Regulations 2012 (S.I. No. 243 of 2012) apply and that has a BER of C3 of higher, the BER (within the meaning of those Regulations) being improved by not less than 2 building energy ratings. 

All landlords must serve a notice of rent review ensuring that they follow the sample notice. The sample notice of rent review must be followed closely, and landlords should not deviate from the wording used therein or delete information from same as doing so could invalidate the notice of rent review in full. 

All landlords serving a notice of rent review in a Rent Pressure Zone relying on an exemption must fill in Part A, Part B and Part D of the Notice of Rent Review form.

The information required to ensure that you fill out the form entitled Part A in full and correctly are:

  • Tenant(s) name
  • Landlord(s) name
  • Dwelling address
  • New amount of rent being sought
  • Date from which new rent is to be paid from
  • 3 comparable dwellings. Please note that the 3 comparable properties must have been advertised within the previous 4 weeks of the date of service of the notice. 3 comparables have to be provided, if less are provided the notice of rent review may be deemed invalid. Comparable properties do not have to be in the exact same town or geographical location. Landlords can look for similar properties in similar towns nationwide.

The information required to ensure that you fill out the form entitled Part B in full and correctly are:

  • Landlord(s) name
  • Tick relevant exemption information that applies to the dwelling.

Part D of the form seeks the landlords signature or if a landlord has appointed an authorised agent, the agent can sign Part D on the landlord’s behalf.

Part A & Part B & Part D must be served on a tenant together or the notice of rent review may be deemed invalid.

Obligation on Landlords to Notify the RTB of their Reliance on an Exemption 

Since 1st July 2019 landlords must inform the RTB that they are relying on an exemption which means that they do not have to adhere to the Rent Pressure Zone formula. Landlords must fill out a new form a with all the correct relevant information and send it to the RTB within one month of the new rent amount being set.

The information required to ensure that you fill out the form in full correctly are:

  • Landlords name
  • Dwelling address
  • Tenancy Registration number 
  • New amount of rent being sought
  • Date from which new rent is to be paid from
  • Previous rent amount and the date which that rent amount was paid from (only if property was rented before, if it was not you tick box below)
  • You will then tick the appropriate exemption that applies to you.
  • When relying on the substantial change exemption you will have to select from 3 separate categories of works the relevant
  • As applicable – new BER certification (where listed as a reason)
  • As applicable – letter of certification from one of the following clarifying the nature of structural changes: architect, chartered surveyor, chartered engineer and/or planning documentation in relation to these changes