Dáil committee report renews call for rent regulation

Fresh proposals for rent certainty and ways to regulate the rental sector are set to give the Government a major headache after the last coalition blocked similar plans for legal reasons.

Dáil committee report renews call for rent regulation

A draft report by the Dáil housing committee proposes the introduction of rent regulation and concludes that evidence it heard recommended future increases should be in line with inflation, a situation which elsewhere in Europe has not resulted in an exodus of landlords.

Proposals examined by the last government to link rent hikes to inflation were abandoned amid fears landlords would take a court challenge or leave the rental sector in their droves. A two-year rent freeze was eventually agreed which stops landlords increasing rates now until 2017.

Details of a draft report obtained by the Irish Examiner show the Dáil housing committee has made fresh recommendations for long-term certainty in the sector, amid new tenants facing rising rates in urban areas, including Dubin and Cork.

The draft report, set to be discussed by the committee tomorrow, advises the introduction of “a system of rent regulation to provide greater certainty for tenants and landlords alike with respect to rent regulation”.

The 190-page report notes evidence given during hearings, including from Trinity College professor PJ Drudy and the National Economic and Social Council.

“In his submission to the committee, Professor PJ Drudy strongly argued for the introduction of rent regulation in Ireland, where rent increases are in line with inflation. In his view this is the practice throughout Europe, and there is no evidence that rent regulation has resulted in an exodus of landlords,” it says.

The report also notes pressure from the NESC for rent certainty: “A similar proposal was made by the NESC in its 2015 report. The NESC identified four elements of a secure occupant modal for Ireland, including introducing a system of rent regulation to provide greater certainty for tenants and landlords through ‘a mechanism for disciplined market sensitive rent adjustment’.”

The Government has promised to take on board the Dáil housing committee’s proposals, ahead of a new housing strategy being finalised this year.

The group’s draft report also pushes for the Central Bank to review its strict mortgage lending rules for buyers. Currently, buyers must have up to a fifth of the purchase price, a situation which is prohibiting families from getting a home. The draft report also advocates a reduction in VAT on construction costs of 4.5%, on a trial basis.

Committee chairman John Curran last night said the final report would be published by June 17, but committee members would discuss the draft this week.

The Fianna Fáil Dublin Mid-West TD said: “We hope the recommendations, which are evidence based, will be acted upon by the minister and the government.”

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