Home economics: Sinead Ryan answers your property questions
I've had the same tenant for 10 years in a property I bought as my 'first home' in 2006, deciding to keep it after I got married and moved. It was supposed to be my pension and I've been on an interest only arrangement which is due to revert to a normal mortgage. I've been advised my repayments are to go up from €825 to €1,450 per month. The 4pc rent cap is proving the final straw and I don't think I can afford this. I have deliberately under-charged the tenant in order to keep him, but is there any way I can increase his rent to market rates which may help me keep the house?
A. The Residential Tenancies Act 2016 precludes this except in very specific circumstances in Rent Pressure Zones.
If you have not reviewed the rent in the last 24 months, you may be permitted to do so, to a specific formula which is:
R x (1 + 0.04 x t/m), where
R = The amount of rent last set under a tenancy for the dwelling (the current rent amount);
t = The number of months between the date the current rent came into effect and the date the new rent amount will come into effect;
m = you must enter 24 or 12 - in your case, 24.
You can then review every 12 months, to a maximum of 4pc pa as normal.
I don't know how much this will increase the rental income by as you don't say what your tenant is paying, but do make sure you are claiming all your offsets against the rent. These have been reduced in latter years, however.
Also, it may be worth checking to see if another bank may offer a better interest rate, particularly since you are off a guarantee period and might have a better loan-to-value ratio.
Q. I read with alarm about the compulsory purchase orders (CPOs) to facilitate new bus routes. There has been much talk on our road about it since we are on a busy bus corridor and there had already been engineers out looking at putting in cycle lanes. I would hate to lose my garden, which is my passion. Can you tell me how the process works and whether I have any say in objecting? I'm really not interested in the money as I'm 79 now.
A. The Bus Connects project plans to develop 230km of dedicated bus corridors and 200km of cycle lanes across the capital. It has suggested up to 1,300 homeowners will be affected by the ambitious plan.
Four routes have been announced on the Northside, another four in west Dublin and up to eight on the Southside. This will take years to complete, but part of the fallout will be splicing parts of gardens to accommodate the routes. These have not been announced yet (or even determined), so it's not possible at this stage to know if yours is included.
There are a range of options open to the National Transport Authority (NTA), including tree-felling, re-direction of routes, and ultimately, demolishing property. CPO is only considered as a last resort. The first, and best, is direct negotiation between the NTA and homeowners.
Offers will be on the generous side, so it may be the case that many people will be happy to bank the cheque and lose a bit of garden, and if you are the only one holding out, then yes, CPO becomes a distinct possibility where it is deemed for the 'public good'.
Firstly, you have the right to get professional advice from a chartered surveyor (and have the cost of it refunded by the NTA) once you are served with a notice to compulsorily purchase your land, according to the Citizens Information Centre. "It is important to remember that you have the right to object, make representations, negotiate, refer to property arbitrators and have your objections heard. If your house and land are compulsorily purchased, you will be eligible for compensation to restore you as far as possible to the same position as you were in before the land and property were acquired. You should be paid compensation based on the market value of your property and be left in the same financial position after the CPO as you were before the process", it adds.
The Society of Chartered Surveyors has an online guide to CPO (www.scsi.ie) specifically relating to the Bus Connects plan. Nothing will happen immediately, but do stay aware of plans announced probably by October.
The Ryan Review
Most of us non-banking mortals would only be delighted if we were able to secure a salary of half a million euro a year. But for some of the striped suit brigade, it's chump change. With banks and the Central Bank in particular dropping senior execs like flies, the Finance Minister has been forced to 'review' the salary cap introduced in 2009 which also banned lucrative bonus payments. Rewarding bad behaviour in the banking crisis isn't a vote getter.
While the headache won't begin for Paschal Donohoe until year end, AIB and Bank of Ireland have been pushing for higher pay at the top, claiming recruitment and retention is a problem. Brexit may well see more banks choosing Ireland as its base, and these wouldn't be bound by the cap, leading to a possible exodus from our State-backed lenders. Nama, now in profit, is also considering pay increases for its dwindling staff (CEO Brendan McDonagh is getting by on a miserly €422,807, bless him).
Irrespective of the review's findings, canny Minister Donohoe will have a beady eye trained on the lean electorate rather than the fat cats.