New guidelines aim to close loophole allowing rent increases

The RTB has warned that maintenance or minor repairs do not qualify as "substantial refurbishments"

The Residential Tenancies Board has published new guidelines aimed at closing the loophole that allows landlords to raise rents or evict tenants based on maintenance or minor repairs.

Under the government’s Rent Pressure Zone legislation introduced last year, landlords in certain areas can only raise rents by 4% each year.

However, the legislation allows landlords to raise rents or evict tenants if they have carried out a “substantial refurbishment” on the property.

Housing charity Threshold has previously warned that up to 12% of tenancies are ended by landlords misusing the clause.

Guidelines

In new guidelines published today, the Residential Tenancies Board (RTB) noted that maintenance or minor repairs do not qualify.

Examples provided for works that would allow landlords to break the 4% limit include attic conversions, house extensions or changes to make-up of the interior floor plan.

Smaller works including painting and decorating, kitchen or bathroom upgrades and plaster repairs do not make the cut, with the definition stating that there must be a substantial change to the nature of the accommodation.

It must be show that the market rent of the property will change based solely on the refurbishment.

Definition

RTB director Rosalind Carroll has urged anyone with concerns over the clarified definition to get in touch:

“In the law, it is a substantial change to the nature of accommodation,” she said. “What we are trying to say is that it is not really about an upgrade of the bathroom in the property – it is about, has the property been extended? Did you add a bedroom?”

She said the board is concerned that many people are unaware of the clause or what works qualify.

“What we are trying to do today is say, ‘here is what it is and if there is a dispute, please come to us,” she said. “’Come to the RTB.’” 

Unenforceable 

In a statement, the Sinn Féin spokesperson on housing Eoin Ó Broin claimed the new guidelines are “not worth the paper they’re printed on.”

“There is also no point in having unenforceable guidelines from the RTB,” he said.

“What is needed are statutory guidelines on what constitutes substantial renovations and strong legal protections for tenants who must vacate a property when substantial change is being made to ensure they have first refusal to return at a rent no greater than the 4% cap.”

He said he was also concerned that the “onus for policing” the new guidelines will rest with the tenant.

“This is not acceptable or fair on tenants, especially more vulnerable tenants,” he said.

“Minister Murphy is abdicating his responsibility to protect tenants’ rights. He must amend the legislation to close this loophole or tenants will continue to face dubious notices to quit.”

The Minister for Housing Eoghan Murphy during a visit to the first of the new permanent emergency beds facilities which will be operated by the Peter McVerry Trust on the Cabra Road, 22-11-2017. Image: Sam Boal/RollingNews

Legislation

The Housing Minister Eoghan Murphy announced plans to close the loophole last week, after two new reports highlighted the country’s spiralling rent and property prices.

Speaking the Dáil he said: "As I announced in September, I will bring forward a definition – were at the final phases of clarifying that at the moment - to close that loophole,” he said.

He pledged to put the new definition "on a legislative footing” if it was deemed necessary.

The latest Irish Rental Price Report from Daft.ie has shown that the average national rent is now up around €12,000 – 16% higher than it was at the peak of the economic boom.