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New rules linking rent increases to inflation will be in place within a week - O'Brien

New laws linking rent increases to inflation will be in place within a week, according to the Min...
Michael Staines
Michael Staines

08.37 1 Jul 2021


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New rules linking rent increas...

New rules linking rent increases to inflation will be in place within a week - O'Brien

Michael Staines
Michael Staines

08.37 1 Jul 2021


Share this article


New laws linking rent increases to inflation will be in place within a week, according to the Minister for Housing.

Cabinet has approved the new rules which will replace the current annual 4% increase allowed under Rent Pressure Zone (RPZ) legislation.

Moving forward, RPZ increases can be no higher than the general inflation recorded in the Harmonised Index of Consumer Prices (HICP) – which currently stands at just under 2%.

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New rules linking rent increases to inflation will be in place within a week - O'Brien

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On Newstalk Breakfast this morning, Housing Minister Darragh O’Brien said permitted increases would have been lower in previous years.

“If you look at inflation over the last three years, that averages around 0.73% per annum – so just under one-quarter of 1%,” he said.

“So, instead of a 4% increase that some tenants would have borne because that was the maximum – the maximum over the last three years would have been under 1%.

“Now, currently, inflation is running a bit higher than that but we are still looking at about 1.9%”

"Fairer"

He said he believes it is a “fairer way to do it.”

“This is a measure that is used in continental Europe quite frequently,” he said.

“I have listened to a lot to the advice of academics in this area and indeed tenancy advocates and others and that is why I am bringing through these changes.”

Rent Pressure Zone

Minister O’Brien said he expedited the changes after it emerged that some tenants were facing 8% rent increases this summer.

While Rent Pressure Zones legislation limited increases to 4% per year, landlords carrying out their first review in two years were entitled to impose an 8% increase.

While many people have faced no increase through the pandemic, there were fears that many would face increases as soon as the rent freeze and eviction ban ended this month.

“My plan is, with Dáil approval - and I expect to get approval from all on this - that these measures will be in place within a week,” said Minister O’Brien.

Eviction ban

The measures are to be inserted into the Residential Tenancies Bill which is expected to pass into law on July 9th.

Minister O’Brien said the legislation will also extend the current eviction and rent bans for those most affected by COVID until January of next year.

It will also cap the level of deposit a landlord is permitted to demand at two months rent and introduce changes regarding the maximum notice period for students.

For people living outside Rent Pressure Zones, rent reviews will be permitted every two years up until the end of 2024.

Minister O'Brien also said new Threshold figures showing that more than half of renters do not feel secure in their home are “very stark but not surprising.”

He said he is looking at ways to increase tenures of indefinite duration and move away from the current rolling one-year model.

You can listen back here:

New rules linking rent increases to inflation will be in place within a week - O'Brien

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