29th May 2024
IPOA asserts that RPZs only serve to exacerbate an already dysfunctional property rental market
The Irish Property Owners Association (IPOA) welcomes the recommendations outlined in the Housing Commission\’s recent report advocating for the abolition of Rent Pressure Zones (RPZs) in Ireland. The report, which critically examines the current state of Ireland\’s housing market, suggests replacing the RPZ system with a more effective regulatory framework.
The RPZ system, which has now been in place for eight years, restricts rent increases to inflation or a maximum of 2 per cent, whichever is lower.
Among the key recommendations in the report concerning RPZs are:
- The RPZ system is no longer fit for purpose and has contributed to a two-tier rental market.
- That the methodology used to extend RPZs to new areas is inconsistent and inequitable.
- The report recommends that all policy measures and interventions should be assessed against their impact on housing supply whereby Regulatory Impact Assessments (RIAs) are performed on all such interventions. The IPOA agrees with this as to date, there has been a negative impact of over-regulation on the supply of rental properties.
Chairperson of the IPOA, Mary Conway, stated, \”We welcome the Housing Commission\’s recognition of the flaws in the current RPZ system and their recommendations for a more balanced approach to rent regulation.”
“On the back of this Report’s recommendations on RPZs, which were first introduced as a temporary measure, we would like to see government action in motion, with the implementation of the RPZ related proposals. This should see these unnecessary rent control interventions removed. There is ample evidence across Europe that they simply do not work, and only serve to exacerbate an already dysfunctional property rental market.”
The IPOA acknowledges the pressing need to address Ireland\’s housing crisis and supports comprehensive reforms that enhance the rental market\’s efficiency and fairness. As the government prepares for upcoming elections, the IPOA calls for constructive dialogue and collaboration among all stakeholders to implement policies that will deliver long-term solutions for Ireland\’s housing challenges.
Additional IPOA issues with the Report
- The Report also provides for the introduction of a new system that pegs rent increases to nearby homes of similar quality, taking into account various factors such as management and maintenance costs, interest rates, household incomes, and affordability. However, the IPOA believes the complexity of such a system makes it impractical and argues that more rent controls will lead to less supply given associated compliance burdens.
- However, IPOA expresses caution regarding the recommendation to establish a publicly available rent register. While transparency in the rental market is important, making all rents publicly available could have unintended consequences. The IPOA believes that such a measure could compromise the right to privacy of both landlords and tenants and potentially lead to increased rental prices.
About the IPOA
About the IPOA: Founded in 1993, the IPOA is a not-for-profit organisation that seeks to protect and promote the interests of private residential property owners and encourage the supply of good quality accommodation and professional standards of property management. The IPOA is a national association, representing 2,000 landlords from single property owners to multiple property owners. For more information about Irish Property Owners’ Association, visit: www.ipoa.ie