ieExplains: Building and renting out modular cabins

Homeowners will not be required to get planning, but will need to inform their local council of their plans.

The Government is pressing ahead with plans to allow people to build modular cabins in their back gardens without planning permission for rental.

But what exactly are the plans and how will it impact on rent rules?

How can I build one?

The Government approved the updating of exempted developments, which will allow for modular cabins up to 45sq m be built at the rear of their property.

While homeowners will not be required to get planning, they will need to inform their local council of their plans. The cabins will also need to meet existing building standards.

The Government previously announced that these cabins would only be able to be developed if a household had at least 25sq m of space left.

Any less than this and they will not be permitted.

Who will be able to rent them out and what are the rules?

Approval was also given to allow households to rent out these cabins on the private rental market.

These units can be rented out via the Rent-A-Room scheme, which caps the rent at €14,000 per year, but the household does not pay tax.

Households will be permitted to charge over €14,000 per year, but they will not be entitled to the income tax-free.

These will not be traditional tenancy agreements but instead licence agreements. This provides fewer tenancy protections to renters living in those properties.

A landlord will only be able to rent out the modular cabins if the main house is their principle private dwelling.

The Government has argued this will prevent a widespread proliferation of modular cabins in the back gardens of existing rental properties.

What has the Government been saying about the plan?

Housing minister James Browne has said the modular units would be overseen by “very strict” building regulations, with no subdivision of the property or separate entrances.

“These have to be quality homes. These won’t be cheap to put in either, so I don’t expect to see a significant amount of them,” Mr Browne said.

“What they really are is an option for particular families that may work for them.”

Taoiseach Micheál Martin, meanwhile, argued it was a practical measure to ensure there is a variety of housing options for people.

Mr Martin said the Government needed to be “practical and pragmatic” about the change on rental rules.

“I don’t think people, or parents for example, would build something costing up to €80,000 if it was only to be used for a son or a daughter, who might leave after two or three years,” he said.

However, Mr Martin said the Coalition would keep the planned change under review.

What has been the reaction to the change?

The opposition has criticised the change, with calls for significant scrutiny on the exempted development regulations in the Oireachtas housing committee.

Meanwhile, Threshold, Age Action, and the Irish Council for International Students called for a halt to the plan until a full review is carried out.

The three groups raised concerns about the fact renters will be treated as licencees rather than tenants, which provides fewer protections from eviction and rent increases.

They argue the removal of planning requirements could increase the “likelihood that poorly designed and unsuitable housing will be delivered”.