FOCUS IRELAND WELCOMES MOVE TO CREATE RENT “PRESSURE ZONES” BUT WARNS IT MAY NOT BE ENOUGH TO DEAL WITH CRISIS IN THE RENTAL SECTOR
Focus Ireland today broadly welcomed Housing Minister Simon Coveney’s move to introduce ‘rent pressure zones’ in an attempt to stall the spiralling costs in Dublin and Cork. The move is part of a wider rental strategy published by the Government today as part of its Rebuilding Ireland plan.
Latest figures show prices in the capital have jumped by as much as 40pc since the downturn, while the average cost of renting a property nationwide is now €1,000 a month.
However, the charity said it is worried that the rent control seems to only apply to existing tenancies. While this move will help to reduce the risk of existing tenants losing their homes Focus Ireland said it is concerned that landlords will shift all the price pressure to new leases.
Focus Ireland Director of Advocacy Mike Allen said: “This will mean it will remain extremely difficult for people trying to move out of homelessness as rents for new leases will continue to escalate as landlords try to compensate themselves for the fact that they won’t be able to maximise rents in these “pressure zones” once a tenancy is under way. This problem could have been avoided by including ‘re-lets’ in the proposed legislation as this would have widened the positive impact of this emergency measure and improved access to the rental market.”
Focus Ireland said that a simple measure to control “re-let” rents in this way would also remove the risk of some landlords evicting sitting tenants to bring in new tenants at a higher rate or rent.
Mr. Allen added: “We are also concerned at the very real risk that we could now see rapid rent rises in Limerick, Galway, Waterford and Kildare as landlords attempt to take action before any control is introduced. It would have been better to have included these areas which already have rapidly rising rents in the initial proposal, with an option to then take them out if the PRTB research showed the measures were not needed.”
The charity welcomed moves in the report to help increase supply of housing by extending the pilot Repair and Leasing scheme to be available nationally by Q2 2017 along with the planned delivery of a National Vacant Housing Strategy by Q 1 next year which will aim to help get some of the national stock of over 200,000 vacant homes back into use.
Meanwhile, Focus Ireland said the reference in the strategy which “encourages” banks and landlord borrowers in arrears to agree solutions which may include retaining the use of the property for rental purposes where tenant is in receipt of housing support will in reality provide no real comfort for the thousands of tenants in this situation.
Focus Ireland said that the new figures issued this week by the Central Bank clearly report the growing crisis facing tenants in buy-to-let properties and called for the Government to take urgent action now to help these vulnerable households. Figures for the three months to the end of September report that over 280 houses or apartments owned by landlords were repossessed by banks or financial institutions.
Focus Ireland has called on the Government to change the law to stop banks and other financial institutions from being able to repossess buy-to-let homes and evict the tenant. The charity said up to 40 children in 20 families are being forced into homelessness every month by banks & financial institutions through evictions from buy-to-let homes.
Last week in the Dáil it was discussed how to increase the protection for tenants in the Planning and Development (Housing) and Residential Tenancies Bill 2016. The Bill has now been referred to committee. The Government’s “Tyrrelstown Amendment’ in relation to this Bill initially proposes to ensure that landlords with 20 or more properties cannot evict their tenants in one go. However, most of the evictions from buy-to-let tenancies are by landlords with 1 or 2 properties.”
Contact: Michelle Moran 086 468 0442 or Roughan Mac Namara – 086 85 15 117