Charity’s objectives for Budget 2022 include emphasis on homeless prevention, reform of the HAP (Housing Assisted Payment) system and establishment of a rent arrears fund
National housing charity Threshold has called for increased investment in homeless prevention services as it assisted 1,152 households in avoiding homelessness in the second quarter of 2021 alone (April – June). This is one of several measures the charity wants to see in Budget 2022 to improve the private rented sector and protect these tenants from eviction and the risk of entering homelessness.
While Threshold broadly welcomes the ambitious targets set by government in its Housing for All strategy, announced earlier this month, the charity cautions that it will take time for the impact of these measures to take hold.
“While the government has clearly demonstrated its commitment to homeownership, close to one in three families are currently living in the private rented sector and many who have missed opportunities to purchase their own home will likely rent for life,” said Aideen Hayden, Chairperson, Threshold. “Therefore, the private rented sector will continue to play a significant role as a long-term housing tenure into the future. Investment in key areas is necessary to ensure that the sector is robust and fit-for-purpose to provide suitable homes for those residing there.”
Threshold is calling on the government to commit to the following measures as part of Budget 2022:
- an increase in investment in homeless prevention
- investment in and reform of the Housing Assistance Payment (HAP) system
- the establishment of a rent arrears fund to support both tenants and landlords, among other legislative changes to address rent arrears
- the introduction of tax measures to retain small-scale landlords in the private rented sector and to incentivise long-term lease agreements
- the establishment of energy efficiency schemes designed specifically for the private rented sector
- the establishment of a rental Deposit Protection Scheme
- the allocation of necessary funds to hold a referendum on the right to housing.
Threshold is calling on the government to ringfence 20% of this year’s homelessness budget specifically for vital services which work to prevent homelessness before it happens. Research from the Dublin Region Homeless Executive shows that the majority of people who enter homelessness do so after losing their private rented home. Given the increasing complexity of the legislation protecting renters, Threshold believes that there is a greater need for such specialist, independent advice and advocacy services to support people to remain in their homes.
“Homeless prevention must be at the forefront of all investment in homeless service provision, policies and strategies,” said Hayden. “This would ensure the numbers experiencing homelessness would continue to decline, while the supply of affordable housing for purchase or rent is increased.”
Threshold supports an average of 97 households per month whose landlords plan to sell their homes. “The most pressing issue private renters face is receiving a notice of termination on the grounds of sale from their landlord,” said Hayden.
Housing Assistance Payment
As the Housing Assistance Payment (HAP) has replaced rent supplement as a long-term housing support, Threshold is proposing a €15 million investment in a new Tenancy Sustainment Protocol, to assist HAP tenants with rent increases and unaffordable top-ups. Threshold believes that this would be more beneficial to both tenants and landlords, as well as more cost-effective for the State, than moving such tenants onto Homeless HAP.
In addition, it is Threshold’s view that material reforms must be made to the existing HAP system to ensure it is adequately meeting the needs of low-income households. These include: commissioning an enquiry into the reasons that some landlords and agents refuse HAP; the rollout of an education and awareness-raising campaign on HAP for landlords and agents; a review of current HAP limits to bring them in line with market rents; an increase in the single person rate to bring it in line with that of couples; and a review of the administration of HAP.
Rent arrears fund
Threshold has identified the need for €20 million to be allocated to a Rent Arrears Fund – similar to those which have been established in Wales and Scotland – as an exceptional measure to protect the tenancies of those who have accrued rent arrears after losing employment or income as a result of the Covid-19 pandemic.
“Threshold’s advisors supported almost 300 private renters on issues relating to arrears in the second quarter of 2021,” said Hayden. “Introducing measures to allow tenants to deal with their debt is the sensible approach – it’s less costly to the State than allowing tenants to be evicted for rent arrears and placed at risk of homelessness, and it would also protect landlords who may be placed in adverse financial circumstance, or even mortgage arrears, if a tenant is unable to pay off their rent arrears.”
Other legislative changes to address rent arrears
In order to support tenants in arrears and protect their tenancies, Threshold recommends an increase in the warning notice period for rent arrears, from the current 28 days to 90 days. Threshold also urges the government to introduce a stay on evictions for rent arrears where the tenant has made an application to the Rent Arrears Fund, and/or is engaging with the Workplace Relations Commission over a landlord’s refusal to accept HAP or rent supplement.
Measures for small-scale landlords
Threshold is particularly concerned over the number of small-scale individual landlords leaving the private rented sector, particularly on the grounds of sale. In the last two years, Threshold has supported on average 97 households a month whose landlord was planning to sell the home.
Threshold welcomes the government’s commitment in Housing for All to review the recommendations of the Working Group on the Tax and Fiscal Treatment of Landlords. The charity stresses that there can be no delay in reviewing the recommendations and taking action as appropriate, as many landlords have indicated their intention to exit the market.
In addition, Threshold points out that measures could be introduced to promote long-term leases, thus improving security of tenure. “Many of those landlords who bought property to ensure financial security in their retirement are now approaching that time of their life and they may find a long-term lease agreement an attractive option,” said Hayden. “Incentivising these landlords to offer long-term leases would be an efficient use of public resources.”
Threshold welcomes the commitment in Housing for All to introduce a minimum BER (Building Energy Rating) or cost-optimal equivalent in the private rented sector from 2025. However, the charity states that targeted schemes, designed specifically for the private rented sector, are necessary to ensure successful delivery on this target and to ensure it does not result in rental homes being lost.
Deposit Protection Scheme
Threshold welcomes the government’s commitment to establish a rental Deposit Protection Scheme such as those already operating in Northern Ireland, England and Scotland. The charity wants swift action on this, as the scheme was first legislated for in 2015 and Threshold supported over 500 private renters in Q2 alone, who were seeking the return of their deposit from their landlord. Threshold points out that it will be necessary not only to review the original legislation for a Deposit Protection Scheme, but also to allocate funds towards its establishment.
Referendum on the right to housing
To underpin and solidify the protection of and respect for the homes of private renters – and to ensure that all barriers to the development of homes are removed – Threshold believes that the right to housing must be enshrined in the Constitution of Ireland. Threshold welcomes the government’s commitment, set out in last year’s Programme for Government, to hold a referendum on housing, and hopes that this will be framed specifically as a referendum on the right to housing.
Threshold Q2 2021 Quarterly Impact Report
Investing in Home – Threshold’s Pre Budget Submission 2022