Cabinet warned of race to hike rents

Extra.ie​

19 hours ago

The Cabinet was given a warning that there is a 'significant risk' landlords would impose 'significant rent increases' before laws expanding Rent Pressure Zones are enacted, Extra.ie can reveal.
The nationwide extension of RPZs – which cap annual rent increases at 2% – was part of a suite of rental reform changes approved this week.
However, the memo circulated to ministers before they agreed the changes on Tuesday highlighted risks to tenants by not immediately legislating after the announcement. The secret document, obtained by Extra.ie, warned that landlords who are entitled to conduct a rent review would likely do so in advance of the changes on March 1, 2026. The nationwide extension of RPZs – which cap annual rent increases at 2% – was part of a suite of rental reform changes approved this week. Pic: Shutterstock
It read: 'With no restriction in rent increase, other than not charging above market rent, there is a very significant risk that landlords who haven't already carried out a rent review during the past two years may decide to increase rents before March 1,' the memo warned.
Currently, landlords outside RPZs can conduct rent reviews every two years with 90 days' notice. Extra.ie has estimated that roughly 11,502 tenancies could see rents legally raised to market rates if the new laws were enacted on March 1 next year as initially planned.
To offset this risk, the memo also proposed to bring forward priority legislation to reduce the time period whereby rent reviews could be initiated. 'It is proposed to bring forward priority legislation to extend the protections of RPZs to non-RPZ areas at the earliest possible date,' the memo read. Currently, landlords outside RPZs can conduct rent reviews every two years with 90 days' notice. Pic: Getty Images
In an indication of the chaotic nature of decision-making at the heart of Government, while ministers were told of the plan to fast-track the legislation to extend RPZs nationally on Tuesday morning, hours later officials in the Department of Housing were stating that 'all' of the changes would come in on March 1. 'It's a mess,' one minister told Extra.ie.
The Department of Housing confirmed last night that any rent reviews that are initiated between now and when the new legislation is enacted will be still be valid even if the 90-day period lapses after the law has been passed.
'The law that stands on a given date applies to serving, on that date, of a notice of rent review,' he said. Sinn Féin housing spokesman Eoin Ó Broin told Extra.ie that the plans were being made up 'day by day'.
'This just confirms the utter shambles of the Government's proposed changes of RPZ regulations. They are making up as they are going along,' he remarked. 'They are changing proposals by the day, and as a consequence renters are being put at risk of even further rent hikes and in some cases – where they can't afford the increases – possible homelessness,' he said. Sinn Féin housing spokesman Eoin Ó Broin. Pic: Gareth Chaney/Collins Photos
Mr Ó Broin said that the Government needs to 'take a step back' and 'reconsider this entire proposal and as a matter of urgency'. 'They need to bring forward and enact legislation to extend to the rest of the state as a matter of urgency, but all of the rest of the proposed changes must be scrapped,' he said.
Taoiseach Micheál Martin said yesterday that he expects rent caps to be extended nationwide by this summer. Tánaiste Simon Harris told the Dáil yesterday that the emergency legislation would be brought forward next week to extend rent caps nationwide. That gives land – lords a window of several weeks to initiate rent hike proceedings.
Mr Martin denied that the Government 'flew kites' on its rent control proposals, which he described as 'mod – est'. He accused Opposition politicians of being 'completely over the top' in response to his comments on RPZs earlier this year.
The Cabinet approved a suite of measures modifying RPZs, which currently cap rental increases a t 2 % annually, including incorporating every tenancy in the county under RPZs, allowing new tenancies to be set at market rents and reviewed every six years, as well as linking rents in new-build apartments to inflation. Taoiseach Micheál Martin. Pic: Leah Farrell/RollingNews.ie
Asked whether this extension would be passed by the summer recess, Mr Martin said he expected it would be done 'very quickly', remarking: 'Yes, I mean, the first part will be extending it nationally and that should happen very quickly, because it's a short Bill.'
He said the RPZ extension would be included in the Planning Bill, which will be done before the summer recess, or in a standalone 'shorter' Bill. '
There's no big deal about that, that's not a big issue for us, but it's one we can do fairly quickly,' he said. When put to him that he had earlier this year refused to say whether RPZs would be retained, Mr Martin said: 'No, I did not. I did not. I said they were being reviewed. The response to what I said was completely exaggerated and over the top and motivated by politics.
Politicians came up and said in the Dáil in March 'you're getting rid of RPZs'. I never said we were getting rid of RPZs. 'Everybody knew that in October, a review was under way, the Housing Agency was asked to do it. It was commissioned in October last and people just raced away and said 'we're getting rid of RPZs'.
We never said we were getting rid of RPZs.' He said he told Sinn Féin and the Social Democrats in the Dáil 'repeatedly' that they would not get rid of RPZs. 'It was a great line to put the fear up people. I didn't put the fear up any – body,' he added.
He said he expected the Opposition to support the rent cap extension and that the 'modest' proposals have been 'broadly' welcomed by the construction industry.