Planning and Development (Housing) and Residential Tenancies Act 2016

Amendment of section 19 (setting of rent above market rent prohibited) of Act of 2004

34. Section 19 of the Principal Act is amended by inserting the following subsections after subsection (2):

“(3) The setting of the rent under the tenancy of a dwelling that is carried out on or after the relevant date shall be subject to subsections (4) to (7).

(4) Subject to subsection (5), in setting, at any particular time, the rent under a tenancy of a dwelling in a rent pressure zone, an amount of rent shall not be provided for that is greater than the amount determined by the formula—

R x (1 + 0.04 x t/m)

where—

m is—

(a) 24, where section 24C(1)(a) applies, or

(b) 12, in any other case,

R is the amount of rent last set under a tenancy for the dwelling,

t is the number of months between—

(a) (i) the date the current rent came into effect under a tenancy for the dwelling, or

(ii) where paragraph (a) does not apply but the dwelling was previously let, other than in circumstances to which subsection (5) applies, the date rent became payable under a tenancy for the dwelling as last so let,

and

(b) the date the rent for the tenancy of the dwelling will come into effect after its determination under this subsection.

(5) Subsection (4) does not apply—

(a) where a dwelling has not at any time been the subject of a tenancy during the period of 2 years prior to the date the area is prescribed under section 24A as a rent pressure zone or deemed to be so prescribed;

(b) if, in the period since the rent was last set under a tenancy for the dwelling—

(i) a substantial change in the nature of the accommodation provided under the tenancy occurs, and

(ii) the rent under the tenancy, were it to be set immediately after that change, would, by virtue of that change, be different to what was the market rent for the tenancy at the time the rent was last set under a tenancy for the dwelling.

(6) Where immediately before the relevant date a notice under section 22(2)—

(a) has been served on the tenant, or

(b) the rent review concerned has commenced,

then subsections (3) and (4) shall not apply to the new rent, referred to in section 22(2), stated in that notice in accordance with that section.

(7) In this section—

‘relevant date’ means the date section 33 of the Planning and Development (Housing) and Residential Tenancies Act 2016 comes into operation;

‘rent pressure zone’ means an area—

(a) prescribed by the Minister by order under section 24A as a rent pressure zone under that section, or

(b) in respect of an area to which section 24B relates, deemed to be so prescribed by the Minister under section 24A.”.