new proposals for rent protections

Fian

Taken from this RTE report:

https://www.rte.ie/news/2018/0927/998335-rent_index/

Residential Tenancies Board Director Rosalind Carroll said a lack of rent transparency remained an issue and the RTB was working with Minister for Housing Eoghan Murphy to have a rent register established.

Speaking for myself I think a rent register is a very good Idea. I can see only one reason why rent paid for a particular residential premesis should not be publicly available in the same way that the purchase price paid for it already is. This will dis-incentivise anyone who is evicting tenants in order to start a new tenancy at a higher than permissible rent.

The one reason against this is that it will have a direct impact on the sale price of investment properties to a greater extent than RPZ rules already do. People ho are charging below market rent will be adversely impacted on the value of teh property when they sell, because any new investor will have notice of teh rent cap that applies to that individual premesis. It would be helpful if the RPZ restrictions were removed for all new purchasers, so that when a property is sold the new owner gets it on the basis of what it is actually worth, not on the basis of an artificial rent cap that applies to one appartment but not the appartment next door.

"We're also going to get new powers that, instead of waiting for tenants to come to us, will allow us to proactively go out, investigate and sanction, where we see any contraventions in the law."

Again a good idea imo. PRTB should eb able to proactivly pursue breaches. It is a shame that she is not more conscious that the PRTB's role is to go after problem tenants as well as problem landlords though, in her mind this is only going to help them go after problem landlords.

Minister Murphy said in statement: "We know that quarterly trends can be volatile, but they do continue to rise and this continues to be a challenge. People are paying too much in rent and this has to be better controlled.

"This is why I will shortly be introducing new rent protection measures in to the Dáil. I'll also continue to pursue measures to see longer leases and tenant protections when properties are sold."

Hmm, less sanguine about this quote though. Better rent controls and new rent control measures - is this a flat cap determined by area?

Longer leases - is this beyond the 6 years they have already extended part IV to? I think 6 years is more than long enough.

Most troubling of all though is tenant protections when properties are sold. If they introduce rules that tenants cannot be evicted for sales of properties that would be catastrophic for the sale value of rented properties. Banks will not grant a mortgage to a purcchaser who is not getting vacant posession. I hope that is not what he intends.

Edit: oh and one more thing:

Mr Murphy added: "Home sharing will be tackled in the very near future. All of these new measures will help us move closer to a more stable and more mature rental sector.

I assume this is intended to address Air bnb? I can't imagine it is extending RPZ style protections or security of tenure to licencees? That would be counterproductive - people will be much slower to share their home with people if they can't take it back when they are unhappy with them

amcalester

There'll be a lot of places left empty for 2 years before landlords sell up.

And still nothing to evict non-paying tenants.

Fian

amcalester wrote: »

There'll be a lot of places left empty for 2 years before landlords sell up.

And still nothing to evict non-paying tenants.

There is a common misconception that a 2 year empty period resents rent controls and allows you to ask for market rent. This is not the case - the rent is fixed at 4% increase per annum from previous rent that was set, irrespective of the 2 year vacant period.

amcalester

Fian wrote: »

There is a common misconception that a 2 year empty period resents rent controls and allows you to ask for market rent. This is not the case - the rent is fixed at 4% increase per annum from previous rent that was set, irrespective of the 2 year vacant period.

RTB website would disagree.

Properties that are new to the rental market and have not been let at any time in the previous two years and properties which have undergone a substantial change can be exempted from the measure.

Link

DubCount

Once more - concentrating on price, without dealing with supply, will not solve things. Supply of homes generally, and supply of rental property in particular is ignored.

Giving the RTB powers to investigate without the need for a complaint - great idea.

Rent register - sure, why not. people buying properties are already checking out the existing rental levels.

But where are the measures to improve supply?

price control without supply measures is a recipe for poor quality (why would a LL improve a property), exploitation of tenants (who can complain when there is nowhere to move to if there is a problem) and black market solutions (cash top ups, overcrowding ...)

Rents are too high, rent inflation is too high, but more price controls are not the answer.

Fian

amcalester wrote: »

RTB website would disagree.



Link

This is misleading, or perhaps the person who put that up on teh website misunderstood the legislaiton.

The exemption form RPZ restrictions is set out in subsection 19(5) of the Act as inserted by this provision:

http://www.irishstatutebook.ie/eli/2016/act/17/section/34/enacted/en/html#sec34

(5) Subsection (4) does not apply—

(a) where a dwelling has not at any time been the subject of a tenancy during the period of 2 years prior to the date the area is prescribed under section 24A as a rent pressure zone or deemed to be so prescribed;

(b) if, in the period since the rent was last set under a tenancy for the dwelling—

(i) a substantial change in the nature of the accommodation provided under the tenancy occurs, and

(ii) the rent under the tenancy, were it to be set immediately after that change, would, by virtue of that change, be different to what was the market rent for the tenancy at the time the rent was last set under a tenancy for the dwelling.

That is missing an "or" between (a) and (b) but i expect it would be inserted.

Anyway the PRTB guideance should say:

Not all rental properties are covered by the 4% annual rental restriction.

Properties that are new to the rental market and or properties that have not been let in the 2 years before the area became an RPZ

and properties which have undergone a substantial change can be exempted from the measure.

Of course the correct interpretation also means that properties which have been let in the previous two years are not subject to RPZ restrictions going forward, as long as they were not let in the two years prior to the RPZ being established. This means that new Build to rent tenancies are not subject to RPZ restrictions on a go forward basis, they can be increase by >4% from eyar to year. Which I imagine RTB are not enthusiastic about.

amcalester

Fair enough, the legislation is different to the RTB website.

People will still leave their properties empty in the mistaken belief that it re-sets the clock on rents.

Pkiernan

I wonder if there'll be a tenant payment history register ever?

Baby01032012

It’s in pipeline.

Rent assured offer a tenant check using Stubbs gazette, there is a tenant passport start up about to launch plus others in pipeline that will have a proper vetting procedure for tenants.