The Residential Tenancies Board (RTB) has published a new set of guidelines 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 key point for people to understand is that the 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.
There are 5 key guiding principles provided which landlords should consider when thinking about the use of the Substantial Change exemption:
- Has the property changed?
- Are the works more than works undertaken to merely bring the property up to minimum standards?
- Are the works part of the normal on-going maintenance and repairs expected of a landlord, or do they go beyond this?
- Is there evidence of a change in the letting value of the property due to the change, rather than due to market inflation?
- Are the changes and works substantial, how much has been spent, how long did the works take?
The new guidelines outline areas that are “unlikely to constitute a substantial change” these include
- Upgrade of kitchen
- Upgrade of bathroom(s)
- Painting and decoration
- Plaster repairs
- Replacement of carpets/flooring
- Painting, tiling, decorating
more to follow…