The Cobh local electoral area has been officially designated as a national rent pressure zone (RPZ) to tackle rising rents.
According to the latest rent index report by the Residential Tenancies Board, the average rent in the area is €1,040.51, compared to the national average of €986.50.
The RPZ designation, as implemented by new legislation, means rents will only be able to rise according to a specific formula and by a maximum of 4% per year.
It was announced by Housing Minister Simon Coveney yesterday and applies to not just the town of Cobh but to surrounding areas such as Glanmire and Carrigtwohill.
Mr Coveney told the Irish Examiner that “population growth” and “new jobs” contributed to the area being designated as an RPZ.
“It’s a supply shortage essentially, a very strong demand, a population growth, a lot of new jobs coming to Cork, which is great but with that and with population growth comes a demand for houses and many people can’t afford to buy because there aren’t enough houses for sale so lots and lots of people are relying on the rental market either for temporary solutions or long-term solutions for themselves and their families and that is driving up demand in the rental market and we are not seeing increase in supply,” he said yesterday.
As of today, both Maynooth in Kildare and Cobh are now RPZs.
The rent index report also shows that in the private sector, rent grew by 7.8% across the entire country in the last quarter of 2016.
In Dublin, where the homelessness crisis is at its worst, private rents are now 8.7% above the 2007 peak level, but 2.7% below the national peak for the same year.
For example, Stillorgan, which is 11km south of Dublin city centre, has an average rent of €2,062.34 compared with the national average of €986.50.
Niamh Randall, the national spokeswoman for the Simon Communities, said the figures from yesterday’s rent index report are “concerning”.
“The report from the Residential Tenancies Board today is particularly concerning given that the latest emergency accommodation figures show that the numbers of people trapped in emergency accommodation have reached almost 7,500,” said Ms Randall.
She said that a significant number of people who are becoming homeless are as a result of the squeeze in the rental sector.
“Many people entering into homelessness are coming from the private rental sector where they have been unable to keep pace with rising rents.
“Keeping people in the homes they already have is key to stopping the flow of people into homelessness,” said Ms Randall.
“People renting their homes must have the security of knowing that their rents are in line with real market rates and index-linked, for example, to the Consumer Price Index.”
Fine Gael Cork East TD David Stanton said the Government is working on increasing supply of housing stock.
“Over the medium term, the Government is increasing the supply of housing to ease pressure on the rental market,” said Mr Stanton.
“[On Tuesday], for example, we announced just over €45m in funding to deliver the infrastructure that will support the building of 3,000 new homes in Cork, 520 of which will be in Midleton.”
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