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RTB publishes guidelines for good practice on the "Substantial Change" exemption in Rent Pressure Zones

by RTB | Nov 23, 2017

RTB ANNOUNCE NEW ONE-STOP-SHOP WEBSITE, NEW WEBCHAT FACILITY AND EXTENDS ITS OPENING HOURS

The Residential Tenancies Board (RTB) has published a comprehensive set of guidelines for landlords and tenants, and those working in the rental sector, on what constitutes “substantial change” in rented properties for the purposes of exemptions from rent pressure zone measures. A “substantial change” in the nature of accommodation provided by a landlord can be the basis for the landlord claiming exemption from the rent increase restriction of 4% per year that applies in Rent Pressure Zones. The full guidance note can be downloaded here. The RTB have also published a quick reference leaflet here

“This guide is intended to support landlords and tenants in understanding what a substantial change in the nature of accommodation is, and in what type of circumstances an exemption can be relied upon. This is an issue that both landlords and tenants have asked for further guidance on, and it is an important document in terms of informing those in the sector on the issue and in improving compliance ”, according to the Director of the RTB, Ms. Rosalind Carroll.

“The key point for people to understand is that for the exemption to apply, there needs to be a substantial change in the nature of the accommodation being provided, so it is not just about improving a property but about significant changes;  for example, has the property been extended”, she said.

There are 5 key guiding principles provided which landlords or tenants should consider when thinking about the use of the Substantial Change exemption:

  1. Has the property changed?
  2. Are the works more than works undertaken to merely bring the property up to minimum standards?
  3. Are the works part of the normal on-going maintenance and repairs expected of a landlord, or do they go beyond this?
  4. Is there evidence of a change in the letting value of the property due to the change, rather than due to market inflation?
  5. Are the changes and works substantial, how much has been spent, how long did the works take?

“It is important that landlords, tenants, and anyone working in the sector, familiarise themselves with the guidelines and where major disagreements arise, we would encourage those affected to refer such disputes to the RTB,” Ms. Carroll points out.

It is important to note that while the new RTB guidelines are focused, in particular, on Rent Pressure Zones, there are also requirements in the law in relation to rent reviews in private rented dwellings outside of Rent Pressure Zone areas.

Guidance is also provided on what constitutes “substantial refurbishment” for the purposes of using it as a ground for termination of a tenancy.

 The RTB also announced the launch of a One Stop Shop which is a range of new resources for RTB customers aimed to making it easier to access information and understand one’s rights and obligations as either a landlord or tenant. It includes a new user friendly website with forms, tools and templates; a webchat facility on the site, and the extension of the RTB call-opening hours from 8.30am to 6.30pm.

“Our priority is to improve access to information on rights and responsibilities and the services offered by the RTB. The announcements today are part of our ongoing commitment to improve and develop how our customers and potential customers interact with us”, said Ms Carroll.

 

NOTES TO EDITORS

Residential Tenancies Board: About Us

The Residential Tenancies Board (RTB) is a public body set up to support and developing a well-functioning rental housing sector. We provide high quality information on the sector, resolve disputes between landlords and tenants, and maintain a national register of tenancies.

What we do

Information, research and education

We provide high-quality information to tenants and landlords, as well as to the general public, on their rights and responsibilities, in terms of both living and providing accommodation in the rental sector. We also provide accurate and authoritative data on the rental sector, such as the Rent Index, which allows us to monitor trends in the rental sector, but also allows individuals to check and compare rents in particular locations.

Registrations

All private residential landlords and Approved Housing Bodies (not for profit housing providers, often referred to as AHBS or Housing Associations) are obliged to register their tenancies. At the end of 2016, there were 325,000 tenancies registered with the RTB. A public register of tenancies is available on our website. The registration of tenancies enables us to collect important data on the sector, but is also a key part of regulating and supporting the sector and ensuring landlords and tenants are aware of their rights and responsibilities.

Dispute resolution

Since 2004, the RTB have replaced the courts in dealing with the majority of disputes between landlords and tenants through our Dispute Resolution Service. This service offers a choice of resolution types to parties – mediation or adjudication.

For more information on the Residential Tenancies Board, please visit www.rtb.ie.

 

RENT PRESSURE ZONES

Under the Planning and Development (Housing) and Residential Tenancies Act 2016, parts of the country where rents are highest, and rising, can be designated as Rent Pressure Zones (“RPZ”), and private rents are capped at a maximum increase of 4% annually.

The current RPZs include the four Dublin Local Authorities (Dublin City Council, South Dublin County Council, Dun Laoghaire/ Rathdown County Council and Fingal County Council), and Cork City Council. The others are Cobh, Maynooth, Ballincollig – Carrigaline, Galway City Central, Galway City East, Galway City West, Celbridge – Leixlip, Naas, Kildare – Newbridge, Ashbourne, Laytown – Bettystown, Rathoath, Bray, Wicklow Town, Greystones and Drogheda.