RPZ Rules Explained

RPZ Rules Explained

In the ever-evolving landscape of the rental market, it's crucial for landlords to be well-versed in the rules surrounding Rent Pressure Zones (RPZs). These designated areas have a significant impact on rent increases. Let's delve into what RPZs entail, their criteria for designation, exemptions, and the obligations they impose.

Rent Pressure Zones: A Closer Look

An RPZ is a designated geographical area where rent increases are limited to 2% or the rate of general inflation, as measured by the Harmonised Index of Consumer Prices (HICP), whichever is less.

These zones are located in regions with increasing rents. While the objective of RPZs is to stabilise rent escalation, it is arguable if this is the case for the overall market. 

Criteria for RPZ Designation

To be designated an RPZ, an area must meet specific criteria:

  1. The standardised average rent in the previous quarter must exceed the relevant reference standardised average rent for that quarter. 

  2. The annual rent inflation rate in the area must have surpassed 7% in four of the last six quarters.

Geographic Standardization

The standardization of average rent varies based on the location:

  • Dublin: Dublin's standardized average rent is compared against the National Standardized Average Rent for RPZ designation.

  • Greater Dublin Area (GDA): For LEAs in the GDA (excluding Dublin), the standardization is relative to the Non-Dublin Standardized Average Rent.

  • Rest of Country: LEAs outside Dublin and the GDA are compared against the Rest of Country Standardized Average Rent.

Exemptions and Reliance

It's important to note that not all properties within RPZs are subject to HICP inflation restrictions. Click here for our post on RPZ exemptions. 

Calculating Rent Allowance in RPZs

To ascertain whether you're within an RPZ and to calculate the maximum allowable rent, utilize the RPZ Rent Calculator. This tool aids in understanding the limits set by RPZ regulations.

Current RPZs and Their Duration

As of now, there are 6 Local Authority (LA) areas and 48 Local Electoral Areas (LEAs) designated as Rent Pressure Zones. These zones will retain their designation status until 31 December 2024.

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