RENT PRESSURE ZONE rules have been extended for a further year until 31 December 2025.
Government decided to extend the operation of rent pressure zones at Cabinet today.
A Rent Pressure Zone (RPZ) is a designated area where rent increases are capped.
Rents in a RPZ cannot be increased by more than 2% per annum and the rules apply to both new and existing tenancies in RPZs .
Today’s decision comes shortly after the latest Residential Tenancies Board (RTB) report found that the national average rents for new tenancies are €1,598 per month, up 11% on the previous year, while existing tenancies rose 5.2% to a national average of €1,357.
There was a higher percentage increase in new tenancies outside Dublin, where monthly rent costs rose nearly 13% compared with 10% in the capital.
Earlier today, opposition members rounded on the Taoiseach on the issue of housing, with Sinn Féin’s Mary Lou McDonald highlighting the issue of the government involvement in long-term leasing deals.
Calling it a “fiasco”, she said the policy of providing social housing by leasing properties from the private sector was “wasteful and costly”.
Over the weekend, The Business Post reported that the State has taken out almost 9,000 such long-term leasing deals at a cost of more than €3.24 billion over the 25 years the deals are due to run.
McDonald says billions is being sent on these deals and at the end of it, the state won't own these properties.
— Christina Finn (@christinafinn8) May 14, 2024
Taoiseach responds by saying today it was decided to extend rent pressure zones for another year.
He says long-term leasing is being tappered down and phased out. pic.twitter.com/qAKTOu3JSt
The Taoiseach took issue with the figures, stating that it was being assumed that all leases entered into would run 25 years.
Simon Harris said the State’s long-term leasing to provide social housing would end by December 2025, as promised by Government in 2021.
McDonald said long term social housing leases are subject to “upward-only” rent reviews every three years and are not limited by the 2% cap under Rent Pressure Zones.
“A very, very sweet deal for the property funds,” McDonald told the Dáil.
“This is a scandalous, short-sighted, negligent waste of taxpayers’ money by Government. Instead of investing to boost State-owned social housing stock, you’re paying out huge sums of taxpayers’ money to ‘big shot’ property funds for homes the state won’t own – the incompetence here is off the charts.
“Far from phasing out this wasteful policy, you’ve turbocharged it with bumper profits for property funds. And this puts up in lights that Fine Gael is never ever going to solve the whole housing crisis The simple truth is you’re not capable of it.”
In response, Harris said the measure was being tapered down and phased out by the government, but added that when it comes to housing the government has a “pragmatic view”, stating that is a good thing to do in an emergency.
“All these deals come with upward only rent reviews,’ she says, stating every single aspect of the deal is bad for the state,” said Social Democrats leader Holly Cairns today.
“Quite literally, if you wanted to design a worse way to provide social housing you couldn’t,” she added, stating that “investment funds are loving it”.
“The sweetheart deals are cash cows for them. There’s literally no downside. They lock in sky high rents, include upward only rent reviews, and ensure they retain ownership of the asset at the end.”
Harris again defended the Government’s record on housing, stating: “Never in your lifetime or my lifetime were more social homes provided than were provided last year.
“Because housing policy can’t just be about ideology and emergency, it has to be about using every single provision.
“When it comes to housing, we take a pragmatic view, unlike some of you who rule this out and rule that out, we will use every tool at our disposal to maximize the availability of housing supply for our citizens.”
With reporting by Press Association
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