Senator Zappone welcomes Government’s long overdue rent certainty measures

23.11.2015

Senator Zappone spoke on the Residential Tenancies Bill in the Seanad on 17th November.  The Senator stated that the measures introduced by the Government to provide rent certainty for landlords and tenants are a positive step in the right direction.  She however stressed that this is not the final solution and there are many vulnerable people and families who will not be helped by the Bill.  Read her full comments on the matter below or watch the video.


I compliment the Minister of State and Minister on the measures that aim to provide rent certainty for both landlords and tenants in the private rental sector. It is very positive and welcome for those thousands of families who, as we speak, are at risk of homelessness, which could become a reality for them if rents rise further. I have met a number of such families recently throughout the constituency of Dublin South-West.


I consider these measures to be fair. They could not be considered punitive for landlords. I am using the word "punitive" in a strong sense. I note landlords will miss the opportunity to review the rent three times during the relevant period of four years, but they will be allowed to adjust rents to the market level every 24 months during the four-year period. That measure will create more stability in the market. Therefore, it would be less likely that losses in market rents will be significant.

It is to be welcomed that there will be more emphasis on the landlord's responsibility to demonstrate a justifiable market rent. However, I am concerned to some extent about the practicality of the arrangements for landlords, particularly in regard to the need to present evidence of three comparable properties, etc., in order to justify an increase in rent. I am particularly concerned about the practicality because, as we know, many landlords in the market are small operators. As we also know, they are treated less favourably in the taxation system than the corporate operators. This Bill does not refer to the taxation of private landlords. I want to keep my comments on what is in front of us in the Bill today. I acknowledge that this matter will be raised in regard to the Finance Bill. There are landlords who may be willing to provide rental accommodation to those on the housing assistance programme. I would have more to say about that in terms of the Government's decision on increasing tax relief across the board. With regard to this Bill, however, we need to consider the time and work involved for landlords. This would need to be balanced against the goals regarding the stabilisation of rents.

Many landlords have stated their intention to leave the sector. We need to protect the current supply so we need to listen to them in terms of both practicalities and taxation, which we will deal with later. Today's landlords are simply trying to be reactive to their own cost base. If there is a greater flight of smaller landlords, we may be opening a space for the vulture funds that could buy into the sector and which may have a negative impact on what we are trying to legislate for today.

I welcome the positive measures the Government is proposing to extend the period of notice for any rent increase. I have a question on the practicalities of that. Does the extension of the period from 28 days to 90 days mean a landlord who in the first period of rent freeze intends to raise the rent must give notice 90 days prior to the ending of the first period of two years? I just cannot find the answer to that in the legislation. I am confident, however, that, by extension, the measures will have a positive impact and help to slow down the rent increases, thereby creating stability on both sides.

Based on consultation with Mr. Mike Allen from Focus Ireland in preparing for the debate, I believe the Bill does not help those who are already in difficulty owing to rent rises so far. Many families are homeless or at risk of homelessness because rent supplement levels have simply fallen behind the market. The Department has been consistent in stating raising the rent supplement levels would only drive rents up further. However, as we now have legislation in front of us that will effectively freeze the rent increases for the next two years, I wonder whether the Government, of which the Minister of State is a representative, will go back to the drawing board and consider raising the maximum rent supplement levels after this legislation becomes operational to help many families who are struggling to secure a long-term home. Since we are effectively freezing the rent, increasing the rent supplement will not drive the rents up.

Financial Justice
Financial Justice
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