RPZ Compliance Query

D

Dodger30

Registered User
Messages
14
Hi,

I’m a private landlord and did not realise that the house that I’m renting is in a RPZ. I had been charging rent to my tenants at a rate that was significantly under the market price, I increased it by €150 in January 2023 and again by another €150 in March of this year.

I just received an email this week from the RTB with the subject of ‘Action required to check my rent for RPZ compliance”

It’s asking me to check that the rent is set correctly using the RPZ calculator and one of the other points I noted is where it states that ‘if the registered rent is incorrect, I would refund any overpaid rent to my tenant and update the tenancy registration’

My tenant and I have had no disagreement about the rent increases over the past two years as he appreciated the fact that he was paying well under the market rate for a number of years prior to that.

Would appreciate any advice here on what action, if any, I need to take on the back of the email that I received?
 
I got the same email today. Like you Dodger30, I rent the house out about 3-4 hundred pounds under the area market rate but keep it reasonable as the tenant is good and if I was the ask for the going rate, they would not be able to afford it. In the past year, I have had been affected by the changes to Foreign Landlord tax obligations (I live in Belfast) so have to cover 20% of the rent front to Revenue every month, and dealt with a very thorough and over zealous Tenancy Board inspection with several upgrades needed. The rent doesn't cover the full mortgage but I cover the balance to keep the tenant onboard. According to RTB letter, I would have to refund back another £80 a month, backdated to July, and along with tax changes I just won't be able to cover the extra costs as I make no profit from the tenancy. The tenant would unlikely be able find new accommodation in the area as the nearest similar property is £400 more a month so the situation is far from ideal unfortunately
 
Dodger30 said:
My tenant and I have had no disagreement about the rent increases over the past two years as he appreciated the fact that he was paying well under the market rate for a number of years prior to that.
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The RTB are in the right here that you are in breach of the RPZ rules. The RTB are probably sending letters to hundreds of landlords who seem to have increased rents more than RPZ rules allow. They can do this now with annual registration.

However there is probably not much more the RTB can do except itself send you more letters. To the best of my knowledge the tenant would have to challenge you at the RTB for you to be obliged to make a refund. But they’d have a slam-dunk case.
 
I am aware of the website. I was commenting on the fact that the rtb couldn't do much. My understanding was that they had the power to investigate and impose fines in case of breach up to €15000.
 
I got one of those letters and I used the RTB calculator to set the increase in rent.
I sent the RTB an email saying I increased the rent by the amount allowed by the calculator.
 
I'm Nobody said:
I got one of those letters and I used the RTB calculator to set the increase in rent.
I sent the RTB an email saying I increased the rent by the amount allowed by the calculator.
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I suspect that they are writing to everyone who increased by more than 2% ie if you didn't increase the rent at all for 3 years and then increased it by 6% (entirely legal) you get a letter. Any increase above 2% gets an email. This isn't targeted, it is blanket emails.
 
Rodney82 said:
I got the same email today. Like you Dodger30, I rent the house out about 3-4 hundred pounds under the area market rate but keep it reasonable as the tenant is good and if I was the ask for the going rate, they would not be able to afford it. In the past year, I have had been affected by the changes to Foreign Landlord tax obligations (I live in Belfast) so have to cover 20% of the rent front to Revenue every month, and dealt with a very thorough and over zealous Tenancy Board inspection with several upgrades needed. The rent doesn't cover the full mortgage but I cover the balance to keep the tenant onboard. According to RTB letter, I would have to refund back another £80 a month, backdated to July, and along with tax changes I just won't be able to cover the extra costs as I make no profit from the tenancy. The tenant would unlikely be able find new accommodation in the area as the nearest similar property is £400 more a month so the situation is far from ideal unfortunately
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I'd check this out. I suspect these emails are set out to all tenancies with an increase of more than 2% in the current year. If you don't increase for a number of years, you are entitled to the back increases ie. no rent increase for 5 years, you can increase the rent by 10%. The RTB seem to be basing this campaign on the fact that annual review is showing 75% of rent increases were for 2% or less. The logic is any higher increase must be a breach - not necessarily as many landlords don't increase every year and then play catch up.
 
Greenbook said:
The logic is any higher increase must be a breach - not necessarily as many landlords don't increase every year and then play catch up
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I would suggest that considering the high inflation we had over the past few years and the limit to 2 per cent increase in rpz zone, very few landlords are not applying the legal yearly 10 to 50€ monthly increase. I followed the rules from the beginning, The rent I charge is now closed to 60 per cent under the market. Do you really think that anyone in that situation would just think that they have good renters so will not charge the additional few euros, even more so that landlords know that the rules can be changed at any point?
 
Premos said:
I would suggest that considering the high inflation we had over the past few years and the limit to 2 per cent increase in rpz zone, very few landlords are not applying the legal yearly 10 to 50€ monthly increase. I followed the rules from the beginning, The rent I charge is now closed to 60 per cent under the market. Do you really think that anyone in that situation would just think that they have good renters so will not charge the additional few euros, even more so that landlords know that the rules can be changed at any point?
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Personally, I don't myself - I wait until the tenant leaves and then increase it on the new tenant by the cumulative percentage. Even if the rent is €2,000 per month, the increase is €40 and €20 after tax to me. It's barely worth the hassle of the form filing and filing and can just annoy a good tenant for very little benefit to myself.

That said, 75% of landlords do increase every year and undoubtledly some in the remaining 25% are increasing above what they should.

My point was just because you get an email don't assume that you are in breach (as some of the posters seem to do). You may be okay because you didn't increase in previous years or the breach may not be as large as it first appears.

& yes, I did get caught out by the change from 4% to 2% - you can't now charge 4% for the years when the rate was 4%. My rents are low due to the RPZs and to be honest it is only the increases in the value of the houses and the lack of any place else to put money that is keeping me in.
 
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Greenbook said:
I suspect these emails are set out to all tenancies with an increase of more than 2% in the current year. If you don't increase for a number of years, you are entitled to the back increases ie. no rent increase for 5 years, you can increase the rent by 10%.
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Very little would surprise me about the RTB, but they have the data to hand to work this out themselves. Would they really not bother to check that before sending out such letters? In the case of the OP, it's unlikely that €150 per month equates to less than 2%. I suspect we'd see a lot more compliant landlords complaining if they were receiving such letters.
 
Leo said:
Very little would surprise me about the RTB, but they have the data to hand to work this out themselves. Would they really not bother to check that before sending out such letters? In the case of the OP, it's unlikely that €150 per month equates to less than 2%. I suspect we'd see a lot more compliant landlords complaining if they were receiving such letters.
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Possibly, but I doubt they bothered to work this out by hand. This is the RTB we are talking about!! There are currently 230k registered tenancies and as 25% of those are above 2%, that is a huge amount of work and calculations, nearly 60,000 tenancies to check in fact. Easier just to send blanket emails - the landlords who correctly increased by above 2% will just email back and ask what's the problem.

I doubt €150 per month equates to 2% - my point is that the breach may not be as high as it initially looks if you did not increase for a number of years (which seems to be the case with that poster for the first increase anyway).
 
Leo said:
Very little would surprise me about the RTB,
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Fully agree, they are generally useless. It took me three emails to them last year to get them to deregister a tenancy.

Leo said:
but they have the data to hand to work this out themselves. Would they really not bother to check that before sending out such letters?
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I agree. AFAIK they have taken on a lot of staff and I actually think they have the capacity now to do this.

It's simply a targeted warning letter.
 
Dr Strangelove said:
There is no "by hand". It is a very simple database exercise which will give you a list of names and addresses of landlords who appear to have raised the rent above the RPZ limits. Then a mailmerge.
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I agree that this is just a mail merge - they email everyone showing an increase above 2%. What they don't do is look at all the landlords above 2% and work out whether that is a breach or just an increase taking into account back years.

You could design a system which would do that, but this is the RTB! They've had huge problems getting their app to do the basics ie. allow a landlord to register a tenancy. So I'd be very surprised if it can at this stage work out how each landlord calculated each individual increase. They would have to do such a calculation by hand but it not worth their while doing so. Let the landlord justify the increase.

I think that this is a mail merge - every landlord with a tenancy showing an increase above 2% is being emailed.
 
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