Is this the end of Rent Pressure Zones ?

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The present RPZ regulation is due to expire at the end of the year. If this is not the end of RPZ, will it exist in its present guise or what format will it take? Some of the options are Scrap RPZ, Extend RPZ or Replace RPZ with some other regulation.

The reason we ask is that it will have a bearing on whether we give yet another tenant their notice and put another rental property up for sale. The gap between what rent we can charge and comparable local property rent continues to widen year on year.

On top of this, we now have our tenants asking for extra improvements beyond required maintenance. These improvements are not financially feasible in light of the RPZ rent restrictions and unfair tax treatment.

While we would like to continue as private landlords we are not sure why anyone would invest in private rental property at the moment only to be financially abused by state bodies and criticised by political parties for their own failure in providing adequate social housing.

The government are 2 faced when it comes to private landlords, on one hand they say they want to keep private landlords in the rental market but on the other they introduce policies that penalise private landlords. God help any political party politicians that call canvassing for the forth coming elections.
 
Don’t forget there is an election due in 2025. My guess (and it’s just a guess) is that they will be extended.

That said, new supply is quite strong at least in Dublin and market rents have stabilised. RTB index seems to support this. So it would not be the worst time to relax the requirements.
 
I can't imagine it will change significantly unless there's a major political change which I can't see either. It will just get renewed in some form.

Deciding to continue as a landlord it makes sense to me to take it off the market for 2yrs or sell the property and reinvest in a more suitable property. Having left it myself I haven't reinvested in rental property. But it is hard to ignore the potential returns.
 
They will have to keep them in place. That is the problem with rent controls, once they come in they are impossible to get rid of. Can you imagine the carnage for sitting tenants if rents were allowed to float. Sitting tenants benefiting from the controls could have their rents increase by 100%. It would be political suicide to let that happen.
 
DannyBoyD said:
It could be done on a phased basis;
Click to expand...
They could be kept for the tenant but not the property.

Many people forget the following:
1) the restriction on follow-up lets at market prices was introduced (2015 I think) as a means to ensure that landlords don’t get rid of tenants on spurious grounds in order to reset to market rent
2) subsequently no-reason termination of tenancies have been eliminated (2019 I think) and the reasons for termination are now very limited: selling, major renovations, or own occupancy.

Ergo the rationale for follow-up tenancies at market rents is pretty much gone now. You could keep protections for the tenant

I’m a very free-market guy but I think some level of rent protection for tenants in situ is a good thing. But restricting rents for every future tenant forever makes no sense. TBH I don’t know why someone with deep pockets hasn’t taken it to the High Court by now.

Someone pretty senior in property finance told me recently that build-to-rent is largely over since the 2% rule came in as there is no upside for the funds.
 
Interesting link
www.irishtimes.com

A short history of renting in Ireland

From 19th-century tenements to the crisis of 2015 – 200 years of landlord v tenant
www.irishtimes.com www.irishtimes.com

And probably history repeats itself

Thrown out in 1981 after constitutional challenge


The Irish Times
Social Affairs
A short history of renting in Ireland
From 19th-century tenements to the crisis of 2015 – 200 years of landlord v tenant

Tue Nov 17 2015 - 01:00

Tenement housing (1800 - 1900s)
Following the1801 Act of Union – when Dublin lost its status as a capital and power was transferred to London – the city fell into gradual decline. By the end of the century, about a third of the population lived in one-room tenement slums.

Landlords had little incentive to improve conditions and had the power to serve a notice to quit on tenants at any time. In rural areas, many estates were divided into a system of subdivided leases.

When the potato crop failed in the 1840s, starvation and emigration resulted in the population halving from eight to four million.

Deasy’s Act (1860)
The introduction of the Landlord and Tenant Law in 1860 still forms the foundation for much landlord and tenant law in Ireland

. It introduced the notion of a contractual relationship between both parties, rather than the ancient feudal notion of tenure.


In practice, the odds remained tilted in favour of landlords who had financial muscle and who were given the legal protection to “eject” tenants for breach of contract.

Local authority housing (1930s-1960s)
After Independence, major local authority housing schemes got under way. By 1940, some 41 percent of housing stock had been built by the State, benefiting a cross-section of the population with affordable rents.

By the 1960s this critical mass of housing provided a foundation for the promotion by the State of a market in housing, with supports for mortgage lending, but with minimal regulatory systems.

Between the 1940s and the 1970s, the size of the private rental sector shrank from about 25 per cent of all homes to just over 10 per cent.

Rent Restrictions Act (1960)
After the first World War, temporary rent controls were introduced to limit rent increases caused by a major shortage in housing. They were intended to last for six months until after the end of the war. A series of temporary acts kept the limits in place until 1960, when the Rent Restrictions Act lifted controls on the vast majority of rented homes.

As a result, most who rented after the 1960s were not protected.


The remaining tenants most likely to benefit from rent control were older and poorer renters. While they had low rents, landlords had little incentive to upgrade rent-controlled properties.

Rent control ‘unconstitutional’ (1981-82)
Following a legal challenge by a number of landlords, the Supreme Court ruled in 1981 that rent control was unconstitutional.

Subsequent legislation drafted to protect tenants was also found by the Supreme Court a year later to violate the Constitution and was described as an “unjust attack on the property rights of landlords”.

Economic boom and tenants’ rights (2004)
The boom years of the 1990s and 2000s led to escalating house prices, a surge in construction and increases in rent for private accommodation. Tenants’ rights were still seen to be relatively weak. The Residential Tenancies Act (2004) sought to modernise and professionalise the sector, introducing longer security of tenure and a dispute resolution mechanism as an alternative to court.

Post-boom housing crisis (2015)
A slowdown in housing construction and inability to purchase homes for many means more people in Ireland are renting their homes today than at any other time since the 1950s. An acute housing shortage in Dublin, especially, and other large urban areas has led to sharp and sustained increases in rent. This has driven hundreds of vulnerable families into homelessness.
 
Thanks Knuttel.

A year extension of RPZ will let the government see if they get back into power, hopefully not. Not that there is much of a choice in the opposition.

So the difference between the 2% law abiding landlords and new tenancies continues to grow in double figures.

The RTB write a lot of reports and they can certainly put their spin to suit the narrative of the government of the day to stoke up the opposition.
 
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