RPZ are areas where rents are highest and rising. In these areas rents can only increase by 4% unless they qualify for an exemption. The rent must also still be in line with local market rents for similar properties and 3 examples of comparable rents must be provided.
How often can the rent be reviewed in a Rent Pressure Zone?
If a tenancy in a Rent Pressure Zone began on or after the 24th of December 2016, the landlord can review the rent each year and it can only be increased by a maximum of 4%. The rent being set should not be more than local market rents for similar properties.
For tenancies in Rent Pressure Zones which began before the 24th of December 2016, the landlord can only review the rent 24 months (2 years) after the tenancy came into existence, or 24 months after the date the rent was last set.
When the next rent review is due, the landlord will apply the Rent Pressure Zone formula to determine the rent increase. The RPZ Rent calculator can assist landlords and tenants to calculate the maximum rent allowable for the property. The rent being set should not be more than that of local market rents for similar properties. After this, the landlord will be entitled to review the rent every 12 months.
It is important to remember that not all properties in Rent Pressure Zone areas are subject to the 4% rent 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'.
There have been changes to the legislation effective from 4th June 2019 relating to the exemption rules and criteria as set out below. The following exemptions may be applied by landlords:
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 in the legislation and will only be deemed to have taken place where the below 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,
(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; or
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.
The tenants signed a one year lease in 1st March 2017, at a rate of €900 per month in an RPZ. They were worried that their landlord would increase the rent in 1ST March 2018 to €1,000 per month. As the property is in an RPZ [link] the landlord can only increase it by 4%, restricting the increase to €936.00 pm
A landlord reviews the rent of a dwelling on 1 December 2016 by serving a 90 day notice of rent review indicating that the change will take effect from the 1st March 2017. A subsequent Notice of Rent Review can not issue until 1 December 2018 and must also provide 90 days Notice prior to the change taking effect.
The tenants last rent review was in September 2013. The landlord can initiate a rent review at any time, as it is more than two years since their last rent review, and provided they give the required 90 days notice. Also, if the property is in an RPZ [link] then the landlord can review the rent annually.
A landlord is also required to tell the RTB of the revised rent so that the registration details are up to date.
Where a notice of a rent review has been served by the landlord than either party can submit a dispute to the RTB before the new rent starts or within 28 days of the tenant receiving the notice. For more information please click here