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Rent certainty legislation creating two-tiered system

9 May 2017

Rent Pressure Zone (RPZ) legislation needs to be properly enforced and strengthened to make sure that it protects new renters entering the market. That is according to the national housing charity, Threshold, commenting on the latest Daft.ie rental price report. The research, which covers the first quarter of 2017, indicates average rent nationwide at an all-time high of €1,131.

Chair of Threshold, Dr Aideen Hayden said: “Once again the Daft.ie report highlights the pressures in the private rented sector, reflecting the need to increase the supply of affordable rental homes for low- to middle-income tenants.”

“While it is too early to draw conclusions on the effectiveness of the RPZ, it is clear that the legislation introduced in December 2016 is creating a two-tiered system between sitting and existing tenants. The legislation was intended to protect both categories of tenants and contains a provision that a new tenant can be charged only 4 per cent more than a previous tenant in a Rent Pressure Zone. However, we are aware of cases where this is being flouted. This includes a situation in Cork, where a client was quoted a close to 30 per cent increase on the previous tenant’s rent (from €850 to €1,100) on the basis that carpet had been replaced and the property had been painted in the last year. This clearly falls foul of the 2016 legislation and the spirit of the ‘substantial refurbishment’ exemption.”

She added: “Separately, while the Act provides that a tenant is informed of the previous rent, there is nothing to prevent a rogue landlord misinforming a tenant. For this reason, Threshold is urgently calling for:

  • Monitoring and enforcement of the 2016 legislation to be strengthened for those trying to source accommodation.
  • Greater awareness about tenants’ rights and landlords’ obligations under this legislation.
  • The introduction of a requirement that landlords must update the RTB register with every change of rent.
  • This register be made publicly available and searchable. This could be modelled on the Residential Property Price Register.”

Dr Hayden added: “We are aware that some prospective tenants are desperate, and those who can afford it are willing to pay above and beyond the caps. This is particularly worrying for those who cannot afford these rents, as they are simply priced out of the market.”

“It is our experience that those who secure accommodation outside the RPZ caps are often so relieved to secure a home they are unlikely to challenge a landlord for fear of a breakdown in the relationship. This is compounded by the fact that under the Residential Tenancies Acts, a landlord can terminate a new tenancy within the first six months of its creation without any reason.  If a tenant does want to challenge the rent their only recourse is to take a case to the Residential Tribunal.”

Dr Hayden added: “There are major misconceptions out there – individuals entering new tenancies do not know they have the same legal rights as existing tenants. Some landlords are capitalising on this confusion and the lack of enforcement of the legislation, particularly in this competitive market with limited supply. We believe the additional enforcement measures we are calling for, along with a strengthening of the legislation would help to protect low- to middle-income tenants.”

The Daft.ie report shows that in the first three months of 2017, rents in Dublin have increased by an average 13.9 per cent year-on-year, while nationally rents have risen by an average 13.4 per cent year-on-year.

 

Threshold wishes to acknowledge funding received from the Scheme to Support National Organisations 2016-2019 and the Department of Housing, Planning, Community and Local Government.