When rent pressure zones were introduced in Dublin and Cork in December last year, only Housing Authority areas could be designated as rent pressure zones because the necessary information on rents was not available to decide whether smaller administrative areas met the criteria for designation. At that time, I made a commitment that my Department would work with the Residential Tenancies Board (RTB) to ensure that more refined data was available to allow for more specific targeting of the measure to other areas of the country where severe pressures were being experienced.
Close collaboration between the RTB and the Economic and Social Research Institute (ESRI) has resulted in the revision and development of the methodology for producing the RTB's Rent Index so that we can now use the RTB data to calculate and monitor changes in average rents at the level of Local Electoral Areas (LEAs). The new approach recognises that the same pressures do not apply equally in all parts of the country. It provides a significantly more detailed understanding of market behaviour in the rental sector and an objective evidence base required to appropriately target the Rent Predictability Measure introduced last year and designate the correct areas as Rent Pressure Zones.
The new methodology allowed me to make an order on 26 January 2017 designating 12 Local Electoral Areas as rent pressure zones in parts of counties Cork, Galway, Kildare, Meath and Wicklow. On 29 March 2017, I made a further two orders designating Maynooth and Cobh. Altogether, some 57% of tenancies nationally are now located in rent pressure zones.
The legislation only allows for Housing Authority areas or Local Electoral Areas to be designated as rent pressure zones. For the purposes 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. There is no provision for any other type of area to be designated as a Rent Pressure Zone.
I have undertaken to carry out a review, in June this year, of the Rent Predictability provisions introduced under the Planning and Development (Housing) and Residential Tenancies Act 2016. At that point, the provisions will have been in place for 6 months and it will be possible to ascertain their effectiveness and whether any changes need to be made. The issues the Deputy raises in relation to the areas that can be designated as rent pressure zones will be considered in the context of that review.
