Housing rents and affordability
Deputy Richard Boyd Barrett challenged the Taoiseach on another housing announcement, arguing it was tokenistic and asking for emergency action on sublets, rent freezes and affordable rents. The Taoiseach defended rent pressure zones and rent certainty measures, said a freeze would not solve supply problems, and argued the Government’s approach was keeping increases down.
In what is a pretty well worn pattern, we had yet another announcement, which was the umpteenth announcement, yesterday by the Minister for Housing, Planning and Local Government that purportedly will help to deal with the housing and homelessness crisis and, in particular, the issue of private rented accommodation. Twice yesterday during Taoiseach's Questions, I asked questions in an attempt to interrogate these proposals because they are nothing more than another half-baked, futile exercise in closing the door after the horse has bolted. They are pure tokenism, which will do nothing to address a housing and homelessness emergency that is spiralling out of control. I hope I might get the answers today from the Taoiseach that I did not yesterday.
What is the point of bringing in legislation, even with criminal sanctions about which I am happy, which will limit rent increases to 4% annually when rents are unaffordable anyway and the level of rent is such that nobody on a low income or dependent on housing assistance payment, HAP, or even those on a reasonable income such as teachers, nurses and so on can afford them? Average rents in parts of Dublin are €1,800 per month. In south Dublin, average rent is almost €2,000 per month, which means someone needs €24,000 a year to secure an average rental property. That is impossible. What will the Taoiseach do about that? This is only if someone can secure accommodation at those rents given landlords will not even look at those on HAP. I am dealing with constituents who have come to my office with lists of between 80 and 100 properties that they have viewed trying to find accommodation that they can afford but it is impossible. All this leads directly to homelessness. None of the loopholes relating to substantial refurbishment and moving relatives in for the sale of properties, which are being exploited by vulture funds and landlords, is being addressed. Landlords are using them to evict people. Nothing has been done about affordability. Emergency legislation is needed. Earlier this week, a scandal was revealed yet again. The Sunday Independent revealed that Christian Carter who had previously been caught with 70 people in a five-bedroom house in Cabinteely had seven other properties with up to 30 people living in some of them following an investigation by the newspaper.
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He has been named in the national newspapers.
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What about emergency legislation to deal with sublets?
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Where is the legislation and, more important, the policy action to reduce rents to affordable levels and to provide affordable accommodation to those who need it?
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It will take a while to get the answer.
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Rents in Ireland are high, particularly in Dublin, and they have increased considerably over the past couple of years. They fell quite a lot during the recession and have increased very much over the past couple of years. Nonetheless, while it may come as a surprise to the Deputy, people are paying them. There are few vacant rental properties because people will not pay these rents; the reverse is the case. We do not have enough rental properties available for people to rent. The legislation the Government has brought in is intended to contain the increases in rents in order that people do not face double digit or significant hikes if they live in rent pressure zones, RPZs. According to the statistic produced by the Residential Tenancies Board most recently, average rents increased by just over 1% in the previous quarter. Rents had been increasing at a high rate. In 2016, for example, rents in Dublin increased by 8%. However, the average increase was in the region of 5% for 2017, with an increase of 1.1% in the final quarter. The rent controls for the RPZs that were brought in more than a year ago are working and are having an effect in containing and reducing the increases in people's rent.
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I am not sure what Deputy Boyd Barrett is proposing. He seems to be proposing legislation whereby the Government would intervene and slash rents. We all know why that would not be a practical solution. That would not provide an additional property for any person in the State. If anything, the Government coming in to slash rents would create other problems. There would not be additional supply, which is what we need now. Fewer people would be willing to let their properties and get involved in the buy-to-let sector if a socialist government was to come along and slash rents and control the rents being charged. There would also be many accidental landlords, for example, for whom that rent is how they pay their mortgage. They would be put into mortgage arrears and huge financial difficulty. The Deputy's solution would make matters worse, as is always the case.
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People are paying rents, like Tara Nic Chormaic, the nurse who wrote an open letter about how she cries at the end of a 39-hour week because she has €6 left after she pays her rent. That is how people are paying while others cannot even get these properties. I am proposing as an absolute minimum a complete rent freeze. A 4% increase on an unaffordable rent of €1,900 or €2,000 a month is not payable by people on HAP or by teachers, nurses and ordinary workers. What will the Taoiseach do about that? I would go further, as is the norm in many European countries, and have rents set by local authorities based on square metreage at affordable levels. What is the point in the Minister's proposed legislation given the RTB only has 55 staff and cannot even enforce the current legislation? The Taoiseach is saying they will launch investigations, which is just nonsense.
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We need to stop rent increases, bring rents down to affordable levels and stop vulture funds sitting on empty properties. As I told the Minister earlier this week, Cerberus is sitting on 27 empty properties in Sandyford while Apollo Global Management is sitting on empty properties in Dún Laoghaire. Nothing is being done about this. These speculators are dictating what is going on in the housing market. If the State takes those properties back for public use, that is how the Government will secure additional properties.
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I am confused by the Deputy's proposal. A minute ago he said rents were unaffordable; then he called for a rent freeze. If they are unaffordable-----
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I said at a minimum a rent freeze and affordable square meterage.
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I do not see how a rent freeze would work. We have brought forward rent certainty and rent controls which ensure nobody in most of the country - 60% of people are now covered by rent pressure zones - will faces a rent increase of more than 4% in any given year. I have demonstrated how that is having an effect, with the average increase in the last quarter being just over 1.1%. It is not quite a rent freeze, but it is an increase of in the region of 4%. There are uplifts when it comes to the housing assistance payment, HAP. If somebody is facing homelessness, an uplift of between 20% and 50% can be provided for to make sure the person can afford to pay the rent. We have a HAP finder to assist people in finding available properties. The real problem both for people who want to buy houses, including their first home, and those who need to rent is the lack of supply. The Deputy's solutions would make the position much worse with the Government coming in and setting rents in particular areas and slashing them. Fewer people would then be willing to let properties. Fewer people would be willing to buy properties, with a view to letting them. Loads of people, particularly accidental landlords who are just about getting by and for whom the rent is just about covering the mortgage, would be placed in arrears and the position would be made much worse.