Irish government eases rent cap to boost home supply
[DUBLIN] Ireland's senior government ministers have approved new rental control reforms as part of efforts to tackle the country's acute housing shortage by luring more apartment investors to the market.
An annual rental cap of 2 per cent currently in place in rent pressure zones in urban areas will be expanded nationwide but newly built apartment developments will be exempt. These will be subject to an annual cap linked to the Consumer Price Index instead, Housing Minister James Browne said after a cabinet meeting on Tuesday (Jun 10).
Landlords will have the right to reset rent where it is below market at the end of a tenancy, according to the Housing Ministry. Currently rents are tied to the property. The new measures are to come into place from March 1 2026, the minister said.
Boosting apartment completions is the key force driving the proposal – a key test for Irish ministers who have pledged to build over 300,000 new homes by the end of 2030, as housing remains a top concern for voters.
Industry lobbyists had said that target would be missed unless rents were reformed for apartments, arguing that the annual cap deterred private capital looking for returns and stifled supply. Countries like Germany and the Netherlands have faced similar criticism from institutional investors.
Rental pressure zones in Ireland were initially ushered in as a temporary fix for soaring rental costs that reached 4 per cent per annum in 2016, but was amended to 2 per cent per annum in 2021.
Other measures to be introduced include:
An end of no fault evictions in the case of large landlords with four or more tenancies
The introduction of rolling-six year tenancies of minimum duration for smaller landlords (three or fewer tenancies) with restricted grounds for ending a tenancy
All landlords will be able to sell a property with tenant in-situ at any time
Provisions for build-to-rent student accommodation will be looked at separately, a person familiar said.
'The government wants to be clear that at this time we recognise rents are very high. We also want to be clear that we simply need new investment in rental accommodation, particularly apartments for rent,' Browne told reporters in Dublin. BLOOMBERG
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