Friday, 6 September 2019

Questions (1926)

Seán Fleming

Question:

1926. Deputy Sean Fleming asked the Minister for Housing, Planning and Local Government the position in relation to areas not under rent pressure zones in which rent is increasing and in which landlords put up rent by over 30% in the expectation that the area will be declared a rent pressure zone in the future; the options available for tenants in these situations; and if he will make a statement on the matter. [34885/19]

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Written answers (Question to Housing)

For tenancies in Local Electoral Areas (LEA's) which have not yet been designated as a Rent Pressure Zone, the Residential Tenancies (Amendment) Act 2015, enacted on 4 December 2015, amends Section 20 to provide that rent reviews can only take place every 24 months rather than every 12 months, unless there has been a substantial change in the nature of the accommodation that warrants a review. The review of rent will still be on the basis of the market rent. The landlord must also provide three examples of rents for similar properties in a comparable area to demonstrate this.

Tenants must be given 90 days’ notice of new rent and can make an application for dispute resolution to the Residential Tenancies Board (RTB) if they have not been given the required notice, or if they feel the rent increase is in excess of the market rent. These provisions have effect notwithstanding any provision to the contrary in a lease or tenancy agreement.

Section 24A of the Residential Tenancies Act 2004, as amended, provides that the Housing Agency, in consultation with housing authorities, may make a proposal to the Minister that an area should be considered for designation as a Rent Pressure Zone. Following receipt of such a proposal, the Minister requests the Director of the Residential Tenancies Board (RTB) to conduct an assessment of the area to establish whether or not it meets the criteria for designation and to report to the Minister on whether the area should be designated as a Rent Pressure Zone. For the purpose of the Act, ‘area’ is defined as either the administrative area of a housing authority or a local electoral area within the meaning of section 2 of the Local Government Act 2001.

Up until recently, for an area to be designated a Rent Pressure Zone, it must have satisfied the following criteria set out in section 24A(4) of the Residential Tenancies Act 2004 (as inserted by section 36 of the Planning and Development (Housing) and Residential Tenancies Act 2016):

(i) the annual rate of rent inflation in the area must have been 7% or more in four of the last six quarters; and

(ii) the average rent for tenancies registered in the area with the RTB in the last quarter must be above the average national rent (i.e the National Standardised Rent in the RTB’s Rent Index Report) in the last quarter (€1,169.12 per month in Q1 2019).

However, on 30 May 2019, I signed the Residential Tenancies (Amendment) Act 2019 (Commencement) Order 2019 which appointed 31 May 2019 and 4 June 2019 as the dates on which specified provisions of the Residential Tenancies (Amendment) Act 2019 came into effect, including provisions in respect of the average rent qualifying criterion for RPZ designation. Specifically, in terms of criteria (ii) above, the rent of a dwelling in the Greater Dublin Area (Kildare, Wicklow and Meath) will now be compared to the average rent across the country, excluding Dublin rents; and the rent of a dwelling outside of the Greater Dublin Area will be compared to the average rent across the country, excluding Greater Dublin Area rents.

Each quarterly RTB Rent Index Report includes a summary, in Table 9, of the data used to establish whether each Local Electoral Area fulfils the criteria for designation as a Rent Pressure Zone. This ensures transparency in relation to the position of individual areas in terms of average rent levels and increases.

Further information on Rent Pressure Zones and designations is available on my Department's website at www.housing.gov.ie/PUBLICATIONS, by searching 'rent pressure zones - information'.

The Rent Index, which is published each quarter, allows the Housing Agency to recommend areas to be considered for designation using the new criteria as set out in the 2019 Act. Where, following the procedures set out in the Act, it is found that additional areas meet the new criteria, they will be designated as Rent Pressure Zones.