Landlords afraid of property market because of 'difficult' tenants, incoming RTB chairman claims

THE INCOMING CHAIRMAN of the Residential Tenancies Board (RTB) has claimed that a fear of disruptive tenants is causing part-time landlords to sell their properties.

Tom Dunne appeared before the Oireachtas Housing Committee this morning, following his proposed appointment to the position by Minister for Housing Eoghan Murphy on 18 September. 

Dunne told the committee that some ‘incidental’ landlords are “vulnerable” because they are not aware of the risks associated with the rental market.

He also described tenants as a “business risk” taken on by landlords because of the possibility that their tenancy may not work out.

Responding to questions from Fine Gael senator Martin Conway about the problems faced by ‘incidental’ landlords, Dunne said:

If you are an ‘incidental’ landlord…[and] get a tenant and then the tenant acts in a very disruptive way and they prove to be difficult, that costs that landlord an enormous amount of money.

And I think the fear of that is one of the reasons why you’re beginning to see in the world out there that ‘incidental’ landlords or ‘accidental’ landlords are getting out of the market and are afraid of the market.

Dunne also told the committee that the Residential Tenancies Act existed to empower landlords to deal with tenants in a timely way, which is what the RTB aimed to do.

But he said that Ireland’s strong tenancy rights meant it was difficult to evict a tenant “very quickly” and said it was likely that it would never be possible to do so.

Sinn Féin housing spokesman Eoin Ó Broin disagreed with Dunne’s assessment that disruptive tenants were causing ‘incidental’ landlords to sell their properties.

“My own speculation… is that exit [from the market] is driven more by accidental landlords simply wanting to get out now that property prices have recovered to their original mortgage prices, that this is the opportune moment to grow,” he said.

“But we don’t know if that’s the case, and we don’t know what other factors are influencing [that].”

Dunne also claimed that Real Estate Investment Trusts (REITs) offered better security to tenants than landlords because they could not evict individuals as easily.

“It’s not well known now, but if you rent from a professional landlord, from a REIT or from a company, you actually have a stronger security of tenure than you have if you rent from a private landlord,” he said.

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“A REIT can’t recover possession from you on the basis that it wants a family member to occupy the accommodation.

“A REIT won’t recover possession from you on the basis that they want it refurbished because the properties are probably kept at a higher level before they rent them.”

Last year, the RTB found in favour of a number of tenants who took separate cases against Irish Residential Properties REIT, including one tenant who had their lease breached by the fund, and a couple who wrongly had their deposit withheld.

Under new laws, sanctions have been introduced for landlords who break the provisions under which rental tenancies can be terminated, including selling a home or renting it to a family member.

However, the Irish Property Owners Association agreed with Dunne’s claim, but noted that two-thirds of all tenancies are let by property owners with less than three properties.

“These are the landlords that the State needs to retain in the market. They are providing accommodation for most of the tenants renting” the group said in a statement.