National housing charity says increased investment in homelessness prevention and security for renters are vital to prevent homelessness in the private rental sector
National housing charity Threshold has said increased security for renters must be part of any tax incentives provided to landlords in Budget 2024. This proposed measure is one of several that the charity has called for to improve the private rental sector and prevent homelessness.
Improve security of tenure via incentives
Several proposals are set out in the charity’s pre-Budget submission, which will be published today. Other key recommendations include the establishment of a Deposit Protection Scheme to ensure the fair return of tenancy deposits to private renters, and the introduction of an NCT-style system of certification to ensure that the existing minimum standards of accommodation are met along with investment in a dedicated homeless prevention budget.
Threshold’s Advocacy Manager, Ann-Marie O’Reilly, has called on the Government to ensure that increased security of tenure is one of the outcomes achieved from Budget 2024 measures aimed at retaining small landlords in the sector:
“One of the critical issues facing the private rental sector is the high level of notices of termination being issued by landlords. This is creating pressures on supply and is very concerning for private renters who face the challenge of trying to find a new home.
“We welcome the latest comments from Housing Minister Darragh O’Brien regarding measures to incentivise small landlords to remain in the market, however it is imperative that any measures announced to retain landlords in the market are directly linked to increased security for tenants.”
A sliding tax scale similar to Portugal
One of Threshold’s key proposals in advance of Budget 2024 is the introduction of a reduced tax initiative to enhance security in the private rental sector. In Portugal, this measure has been implemented using a sliding tax scale, which could be effective in Ireland. The most advantageous tax rate is applied to those who offer better security of tenure. It is anticipated that this measure would go some way to retaining supply and, in tandem, provide greater security of tenure for many renters who are facing uncertainty in a volatile market.
O’Reilly added: “Under these agreements, a landlord would only be permitted to evict a tenant if they fail to pay their rent, engage in anti-social behaviour, or cause damage to the property. It’s a win-win situation for tenants and small landlords and could be replicated here or at least examined.”
Deposit Protection Scheme
Threshold has also called for the development of a Deposit Protection Scheme using a custodial model, where a landlord is required to lodge a deposit with a registered tenancy deposit scheme. At the end of the tenancy, the tenant or landlord can apply for the deposit to be returned. If both the tenant and landlord agree, the deposit is returned in part or in full. If there is a disagreement, mediation can resolve the matter.
NCT-style Test for Housing
Threshold is proposing the development of an NCT-style system of certification to ensure minimum standards of accommodation are met. Under this system, landlords would be required to provide a certificate to the Residential Tenancies Board (RTB), every four years, to demonstrate that their property meets minimum standards.
In addition to these proposals, Threshold is also calling on the Government to address affordability issues in the private rental sector through the establishment of a Rent Arrears Fund and by increasing Housing Assistance Payment (HAP) base rates.
“Affordability in the private rental sector is a persistent issue for many renters. The most effective method to increase affordability is to increase affordable supply, but that takes time. While more homes are being built, Threshold proposes that Government introduces a number of measures to support renters who are struggling with the cost of rent, such as expanding Cost-Rental Schemes and increasing HAP base rates.
“We welcome the Minister’s ambition to increase the rental tax credit in Budget 2024; however, it is also important that renters availing of other financial supports can access this tax credit.”
Threshold is calling on the Government to consider the additional following measures in Budget 2024:
- Provide a dedicated Homeless Prevention Budget, amounting to 20% of all homeless expenditure.
- Create a Rent Register that provides accurate information on affordability of homes in the private rental sector.
- Run an energy retrofits promotion campaign aimed at landlords.
- Expand the Tenant in Situ Fund to retain a supply of housing in the private rental sector.
- Expand cost-rental housing to increase the delivery of cost-rental units by Approved Housing Bodies.
- Allocate the necessary funds to hold a Referendum on the Right to Housing in 2024.
To read Threshold’s 2024 pre-Budget submission in full, please visit: https://threshold.ie/wp-content/uploads/2023/09/Threshold-PBS-2024.pdf
Threshold’s helpline is open Monday to Friday, 9am- 9pm at 1800 454 454, with webchat at www.threshold.ie/advice/help for any renter in need of advice or support.