Residential Tenancies Board head admits rents will rise, 'at least in the short term', under new legislation

New rules stipulate new tenancies can match market rent levels, meaning rents in many locations may spiral as one tenancy ends and another begins.

The head of Ireland’s rental regulator has admitted the new tenancies bill will see rents rise, "at least in the short term" but insisted it “is not a free for all”.

Ahead of new rental rules going live on March 1, the Residential Tenancies Board showcased what changes would take place on that date, including updates to security of tenure, rent raises, and new rules on how a tenancy can be ended.

As of that date, a new rent register will go live so tenants and landlords can evaluate the market or average rent of any locality.

For the first time, new rents will be evaluated by both the RTB and the tenant, as opposed to just the renter, to ensure they comply with the new legislation, which states rents can only rise by 2%, or the level of inflation, on an annual basis.

Meanwhile, tenants who have been renting a property for more than six months are now entitled to remain in situ for a minimum of six years. If a landlord owns more than three rental properties, they are no long entitled to sell the rental property and evict the tenant.

However, the new rules also stipulate new tenancies can match market rent levels, meaning rents in many locations may spiral as one tenancy ends and another begins.

Director of the RTB Rosemary Steen said she was satisfied with the steps her organisation had taken to adhere to the new rules. She said enforcement of rental law would now be much more manageable given the majority of relevant records and systems were now digital.

“The key thing here is a move to digital,” she said. “We will have an enhanced ability to view digitally the data and accumulate it. I think this is the last piece in the jigsaw."

She said she was confident the new rent register, which will be populated automatically as landlords submit their new tenancy details, “is valid”, noting the “difference here is that, for the first time, it's going to be visible to a tenant how the landlord has calculated that market rent”.

The register itself does not make tenancy rents visible by individual residence, but rather offers up to 10 varying costs for a locality when queried by a prospective renter.

Asked if she could see any flaws in the new legislation, which has been criticised as likely to raise rents significantly and of being overly geared towards corporate investor landlords, Ms Steen replied: “It’s too early to say that it’s flawed”.

It’s very positive, in my view, in that it gives much greater protection to renters and brings a measure of certainty to the market, but we have to see how that operates in practice. We have to be careful not to prejudge how the market responds.

She acknowledged rents would “rise, at least in the short term” but said it would take time to evaluate the impact of all the changes.

“What I want to communicate today is it's not a free for all,” she said, noting that “there is clear guidance in regard to rent settings that apply”.

“We need to give the market a chance to respond. I do suspect it’ll take a number of months for the changes, in terms of their impact, to be seen,” Ms Steen said.