Taoiseach signals possible end to Rent Pressure Zones

[Brendan Burgess]

Taoiseach signals possible end to Rent Pressure Zones by end of year

Micheál Martin argues that private investment needs a stable environment to increase housing numbers

www.irishtimes.com

“We have time to see if we can develop an alternative system which protects renters but also enables people to have a clear, stable environment in which to invest,” Mr Martin told the This Week programme on RTÉ

The Taoiseach said the reactionary approach to the rental market had been a huge problem as there was no security of the environment for investors. “They don’t know whether it will change from year to year. That has to stop, and that has to change,” he said.



He said the Housing Commission had talked about a reference rents system and the Government would examine that proposal. He said the alternative was not necessarily a “crude change” to RPZs.

 

[Persia]

Be interesting to see how they can unwind the RPZs and what the new and improved finished product looks like.

 

[DannyBoyD]

what the new and improved finished product

I'm impressed with your optimism that it will be either new or improved.

 

[Persia]

Imagine with OBrien removed there can only be an improvement, it would be nigh on impossible to get a worse housing minister.

Edit....now that I think of it, I've thought the exact same after each reshuffle and indeed each successor was worst than the last.

 

[jpd]

More kicking the can down the road

"We gave time to develop an alternative system" cue a study and report and ....

 

[MugsGame]

They don’t know whether it will change from year to year. That has to stop, and that has to change

So he simultaneously acknowledges that uncertainty is undesirable for all actors in the market, while creating more. Brilliant.

 

[joe sod]

Imagine with OBrien removed there can only be an improvement, it would be nigh on impossible to get a worse housing minister.

Its not O'Brien that was the issue, compared to Coveney and Murphy he was very effective, it was Coveney that introduced the RPZs, rental caps and then the inability to evict during covid (government policy not O Brien) that caused the rental supply to dry up completely. Now that they have got rid of the greens they are finally able to look at removing those policies. I would say Coveney and then Murphy were the worst housing ministers

 

[Persia]

Kelly and Coveney were the most useless.

The rest were simply dreadful, nothing anyone will say will change my mind on that.

Paint by numbers politicians, locked into a rinse and repeat ideology.

 

[misemoi]

I would imagine it won't impact sitting tenants if they do make any changes. Newer landlords and tenants are already hitting higher rents and existing ones will remain at the RPZ rates unless the tenant moves out. I am sure there is a natural moving on of tenants as they eventually change their life circumstances (those will lower rents have a better chance of saving a deposit) but you will still have a sizeable chunk who will just stay put. What that split is I can't tell. But people will soon realise the value of the cheaper rent and make decisions accordingly.

 

[Thomas1]

will remain at the RPZ rates unless the tenant moves out

The landlord can’t increase the rent to market level if a tenant leaves, the RPZ rules apply to the property as opposed to any specific tenant.

Same goes if the property is sold, previous rent applies to new owner too if they wish to let the property.

 

[Dr Strangelove]

t. I am sure there is a natural moving on of tenants as they eventually change their life circumstances

Average tenancy is three years last time I checked.

 

[JoeRoberts]

The landlord can’t increase the rent to market level if a tenant leaves, the RPZ rules apply to the property as opposed to any specific tenant

I presume this is the bit they may change though ?

 

[misemoi]

That is what I mean, the landlord will likely still have to wait for the tenant to leave to increase the rent. And tenants may become less likely to leave if they are aware of the value of the lower rent. So average tenancy length might increase. And overholding might become more common.

 

[Premos]

I am pretty sure that tenants who currently are benefiting from low rents in rpz are aware of it. I actually don't think there's any chance of such a proposal will be accepted as it would increase the average rent in the concerned areas. I currently charge 1200, I could charge €2000 or more. I am not the only one in this situation (even just in the small apartment block concerned). If I increase to the market rent when my tenants move (I would suspect in the next 18 months), it's a 80 per cent increase... If even 20 per cent of the landlords do that, the consequences on the national figures would be high. In addition, based on my previous experience of government policies, I would probably try to rent for €2200 or €2300 (I would not have major difficulty finding examples of rent at this level to justify my increase).

 

[Greenbook]

This is the problem, they are embedded at this stage. Many tenants benefit very significantly from them. They will be very, very difficult to get rid of at this point.

 

[Persia]

Politics watch: Controversy over future of rent pressure zones | BreakingNews.ie

Here, we have a look at the topics likely to dominate political discourse in the week to come

www.breakingnews.ie

Shinners positively frothing at the mouth at the thoughts of it.....Martin beats a hasty retreat from the field with kite under his arm.

 

[faketales]

There are a lot of landlords that were "caught" with very low rents well below market rate when the RPZ came in. There was never a history of rent control and many good landlords were happy to have good tenants. It wasn't that many years after the recession when rents were historically low either.

I suspect given a chance to reset rents they won't be caught again. If the rent is well below market value the property won't sell for rental these days and some parties have pushed the idea around only being able to sell a rented house for rental which could seriously impact the value. Basically linking the value of a property to what it was the day the RPZ came in.

RPZ will actually have pushed landlords into being as "greedy" as they can be. They can't afford not to be. Its one thing to leave a few hundred behind a month for the peace of mind of a good tenant, another to know it is for the foreseeable future and may knock a few hundred k off a house sale..

 

[DannyBoyD]

pushed landlords into being as "greedy" as they can be

Explain to me why property owners are "greedy" for wanting to achieve the best return for their investment when letting, but it's perfectly ok to achieve the best price when selling?

 

[charlie007]

Politics watch: Controversy over future of rent pressure zones | BreakingNews.ie

Here, we have a look at the topics likely to dominate political discourse in the week to come

www.breakingnews.ie

I quote from the above......

'After a Housing Commission report published in July showed that 42 per cent of landlords left the market in the 26 months leading to December 2023, Mr Martin said the Government must consider other options including private investment.

Opposition politicians have criticised the Taoiseach’s comments, and called for a ban on rent increases.

Sinn Féin’s housing spokesperson Eoin Ó Broin said that a three-year ban on rent increases and a full month’s rent returned to every private renter was needed.'


I wonder is that 42% figure right? Seems far too high to me.
Though if it is, you gotta like the Shinners response: We've gotten rid of 42% of 'em, now lets help the remainder on their way with a three-year ban on rent increases, among other things!

 

[faketales]

Explain to me why property owners are "greedy" for wanting to achieve the best return for their investment when letting, but it's perfectly ok to achieve the best price when selling?

I don't think in general it is but thats how it will be reported which is what I was trying to show with the quotes.