The private rented sector is an important element of the housing market, with the proportion of households in the sector almost doubling in the period 2006-2011. I am conscious of the difficulties caused by rising rents and the problem of sourcing suitable accommodation, especially in Dublin and other urban centres.
Part 3 of the Residential Tenancies Act 2004 deals with rent and rent reviews. Under the Act, rent may not be greater than the open market rate and may be reviewed (upward or downward) only once a year unless there has been a substantial change in the nature of the accommodation that warrants a review. Tenants must be given 28 days notice of the new rent and may ask their landlord to review the rent if they feel it exceeds the market rate for the property. Disputes about any aspect of rent may be referred to the Private Residential Tenancies Board (PRTB).
The fundamental reason behind the rise in rents is a lack of supply. Increasing both public and private housing supply is a critical issue and earlier this year the Government published Construction 2020 - A Strategy for a Renewed Construction Sector. It includes a commitment to a social housing strategy which is being finalised and will be considered by Government in the coming weeks.
In addition, the PRTB was asked to conduct a study to explore options to address the difficulties being experienced in segments of the private rented sector due to rising rents and to report back to me with policy options. This report, with a specific focus on rent stability, was completed recently and is the first of two studies on the private rented sector.
It explores a range of issues in regard to rent stability, ranging from an examination of rent regulation regimes to the tax treatment of the private rented sector and the role of rent supplement. It will require careful consideration before deciding on the best options to address the current difficulties in the market. The overriding objective is to achieve stability and sustainability in the market for the benefit of tenants, landlords and society as a whole.
