Friday, 6 September 2019

Ceisteanna (1943)

Maureen O'Sullivan

Ceist:

1943. Deputy Maureen O'Sullivan asked the Minister for Housing, Planning and Local Government if Athy local electoral area will be designated as a rent pressure zone; the rent increases in the area over the past two years by quarter; if HAP thresholds will be increased; and if he will make a statement on the matter. [35084/19]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Housing)

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.

Previously, for an area to be designated a Rent Pressure Zone, it must have satisfied the 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), as follows:

(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 relation to 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. The quarterly Rent Index Reports are available to view on the RTB's website at the following link: https://onestopshop.rtb.ie/news/latest-data-from-rtb-quarterly-rent-index-2.

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'.

While rental inflation in the Athy LEA has been above 7% in 4 of the last 6 quarters, the standardised average rent in Athy in Q1 2019 was €801.55, which is below the Non-Dublin Standardised Average Rent of €879.25 per month, thereby not satisfying the criteria for designation as an RPZ.

Under the Housing Assistance Payment (HAP) scheme, tenants source their own accommodation in the private rented market. The tenancy agreement is between the tenant and the landlord and is governed by the Residential Tenancies Acts. The accommodation sourced by tenants should be within the prescribed maximum HAP rent limits, which are based on household size and the rental market within the area concerned.

Each local authority has statutory discretion to agree to a HAP payment up to 20% above the prescribed maximum rent limit in circumstances where it is necessary, because of local rental market conditions, to secure appropriate accommodation for a household. It is a matter for the local authority to determine if the application of the flexibility is warranted on a case by case basis.

I am satisfied that the existing arrangements under the HAP scheme provide adequate flexibility and discretion to local authorities, where necessary, to support households in securing accommodation. Accordingly, I have no plans at present to increase HAP rent limits, a course of action which could have inflationary effects on rents and thereby have a potentially detrimental impact on the wider rental market, including for those households who are not receiving HAP support.