New measures linking rent increases to the rate of inflation are “fairer” and will provide “certainty to the market”, the Minister for Housing has said.
This week the Government approved plans to extend rent pressure zones until 2024, with the 4 per cent rent cap to be replaced and increases linked to general inflation, as measured by the Harmonised Index of Consumer Prices.
Darragh O’Brien claimed these are the “most significant changes” to rent and tenancy rules for half a decade.
But they have come in for criticism from the Opposition, with People Before Profit branding them “worse than useless”.
Mr O’Brien said: “The changes that we’re bringing forward are probably the most significant changes in in terms of tenancies and rents for at least five years.
“It is a significant reduction. It’s balanced, proportionate, and it will be effective.
“Once this legislation passes within the next week, when a review is done, it [rent increases] will be linked to what the inflation was in the preceding 12 months.
“So we’ll be looking at reducing that from 4 per cent right now to, at the moment, about 1.8 per cent. But the average over the last three years is under 0.75 per cent. I think it’s a much it’s a fairer way, it’s a fairer system.”
Mr O’Brien said the residential tenancies bill, expected to take effect from July 19th, is the fifth piece of legislation under the current Government aimed at protecting renters, and would “provide certainty to the market”.
Eviction ban
The legislation also includes an extension of the eviction ban for those in rent arrears due to Covid-19 until January.
The maximum charge for deposits will be the equivalent of two months rent, including a month in advance.
Mr O’Brien said linking rents to inflation would lead to landlords “not running to a target of a 4 per cent increase”.
“It’s a fairer way in relation to assessment and it’s one that’s used in quite a lot of continental European countries too,” he said.
“Most importantly I think it’s been it’s been welcomed by renters, and it’s one of a number of things that we brought forward within the first year.”
He said another eight schemes will be in place this year focusing on tenure of rental, cost of rental and affordable rental.
He criticised Opposition calls for a ban on rent increases.
He said: “When other parties very simplistically put forward ideas that three or four or five-year rent freezes and indefinite eviction bonds won’t have an impact on the supply, they’re frankly, to be kind, they’re being disingenuous.
“I am coming back in the autumn with a comprehensive rent reform bill, I think it’s showing where we’re putting renters right at the centre.”
People Before Profit TD Richard Boyd Barrett labelled the new measures “worse than useless”.
He added: “Any increase on already unaffordable rents is utterly unacceptable.
“Renters in this country are at the pin of their collar with astronomical rents and they cannot take any further increases.
“The only way that renters could enjoy real protection and security would be for the Government to bring rents back to affordable levels.
“This means real rent controls with rents being set by local authorities or rent boards and would be broadly in line with the ability to pay of those on average incomes.”
