How do I make sure rent is set correctly in an RPZ?

• Step 1: Understand the RPZ Rules
• Step 2: Check the RPZ Calculator
• Step 3: Correct your rent and update your tenancy registration, if you need to

Step 1: Understand the RPZ rules

What is an RPZ? 

A Rent Pressure Zone (RPZ) is an area where rents cannot be increased by more than 2% per year, or by the rate of inflation if this is lower. The rate of inflation is recorded by the Harmonised Index of Consumer Prices (HICP).   

The easiest way to check if your property is in an RPZ and to calculate your rent correctly is to use the RPZ Calculator.

When do RPZ rules apply?

When setting rent in an RPZ area, the RPZ rules apply: 

• For existing tenancies where the landlord and tenant remain the same.
• When one tenancy ends and a new one begins but the landlord remains the same. You must calculate the rent for the new tenants using the previous tenant’s rent and the date it was last set.   
• When a new tenancy begins but the property owner (landlord) has changed. You must calculate the rent for new tenants using the previous tenant’s rent, even if you were not the landlord then. You need to ask for these details when buying the property. If it is not possible, you can contact the RTB to request the last rent amount reported by the previous owner and the date it was set.  

When do RPZ rules not apply?

Some properties in RPZ areas are exempt from rent caps. These include:

• A property that has not been rented for two years before the new tenancy start date.
• A property that is a protected or proposed protected structure and has not been rented for 12 months before the new tenancy start date.
• A property that has undergone a ‘substantial change in the nature of accommodation’. There are strict rules about what ‘substantial change’ means. To qualify for an RPZ exemption, you must meet one of the requirements below:
  • A permanent extension that increases the floor area by at least 25%.
  • Work that improves the Building Energy Rating (BER) by at least 7 levels.
  • Work that achieves three of the following: 
    • The internal layout is permanently altered.
    • The dwelling is adapted for use by a person with a disability.
    • The number of rooms is permanently increased.
    • A BER of D1 or lower is improved by at least three levels.
    • A BER of C3 or higher is improved by at least two levels.

Step 2: Check the RPZ Calculator

Rents in an RPZ cannot be increased by more than 2% per year, or by the rate of inflation if this is lower. The rate of inflation is recorded by the Harmonised Index of Consumer Prices (HICP).   

The easiest way to calculate your rent correctly is to use the RPZ Calculator. The calculator will tell you the maximum rent increase allowed. You will need to enter:

• The current rent amount
• The date the last rent was set
• The date the new rent will begin

To check if a previous rent setting was correct, enter the rent details as they existed at the time of your last rent setting or review.

Step 3: Correct your rent and update your tenancy registration, if you need to

If the rent calculator shows you set the rent incorrectly, you should:

• Calculate how much rent your tenants have overpaid. Download our rent calculation sheet if you need help. 
• Repay any overpaid rent to your tenant. The repayment should be calculated up to the date of refund.
• Update the rent on your online tenancy registration. Your tenants will then receive a letter stating the new rent.
• Keep a record of your refund calculation and proof of repayment to your tenants.