The housing charity Threshold has said the seven per cent increase in average rent during 2018 revealed today by the Residential Tenancies Board, coupled with the first ever rise in homeless figures to above 10,000, shows that there continues to be an affordability crisis in the Private Rental Sector.
“The RTB figures suggest that rents remained static in the final quarter of 2018, which gives some modest cause for optimism”, according to CEO of Threshold John-Mark McCafferty. “However, it is too early to say whether this is a trend. The figures show that rents continued to rise during 2018 at a multiple of the inflation rate, causing major financial hardship for many and homelessness for some. For example, tenants in Dublin are paying on average €120 more a month in rent at the end of 2018 compared to the end of 2017.” As a result, many of the families we assist report that they struggle to budget for food, car insurance payments, monthly public transport costs, school related and other costs while trying to meet their rent payments in order to stay in their home.
Threshold today welcomed the new designation of Limerick City East and Navan as new Rent Pressure Zones, in recognition of the rapid pace of rent rises in both places. This designation means rents can only be increased by 4% per annum. “In the case of Limerick City East in particular we have been pointing to the extraordinary inflation of rental costs there for some time. While this move is welcome, the problem has been obvious for several years and this is coming far too late.
“Tenants in Limerick City East pay €266 more a month in rent in Q4 of 2018 compared to Q4 of 2016, an increase of 31% since RPZs were introduced in Dublin and Cork. Rents in Navan are €286 higher per month (a 32% rise) than they were in Q4 of 2016. Areas such as Dundalk South look set to go on a similar trajectory, as rents there jumped €125 or 13.2% from Q3 2018 to Q4 2018. They are now within €58 of the national average. We have been highlighting for some time the rising rents in places such as these and the need for RPZs to be extended nationally. The experience of tenants in Limerick City East and Navan needs to inform future policy to ensure that tenants elsewhere do not have to experience the same level of rent increases for prolonged periods in order to be afforded the protection of the RPZs.
“Behind the figures, we can nevertheless see that some aspects of policy are working, particularly in relation to the Rent Pressure Zones. Increases in rents for certain existing tenancies are just 3% above rents at the end of 2016. For this to work even better, new tenants need to be able to ascertain the previous rent payable on their new home. This reinforces our call for a Dwelling Specific Rent Register to give tenants this information in order to challenge rents above the permitted increases.