Reform to Rent Pressure Zones is something that “has to be done” to boost supply, Ciara Kelly has said. 

Currently, tenants who live in Rent Pressure Zones (RPZs) cannot have their rent increased by more than inflation or 2% annually - whichever is higher. 

Supporters of the status quo argue the rule is needed to protect renters in a housing crisis that shows no sign of abating. 

However, the Government is understood to be considering a major overhaul of the rules, which they fear are deterring investment. 

New build semi-detached properties. Picture by: Alamy.com.

While existing tenants would continue to enjoy the protection of the 2% cap, it could be abolished for tenants in new builds; instead, rent increases could be linked to the overall rate of inflation. 

Tenants could also enjoy greater protection from eviction during the first six years of their tenancy. 

Rent Pressure Zones

On Newstalk Breakfast, Seán Defoe described it as a reform likely to upset a significant number of people. 

“It strikes me that this is a plan that isn’t going to benefit anybody,” he said. 

“On the one hand, the Government is saying this is going to [get people] to invest more in new apartment buildings and you’re going to make it more of an incentive for investment funds to come to Ireland. 

“But if you’re tying it to inflation, it could be 10% one year or 1%; there’s no guarantee there’s going to be a steady profit out of those if you’re an investment fund. 

“Then on the flip side for renters; you now have no certainty after the six years of your first tenure that you’re not going to be kicked out for any reason at all. 

“And that the rent in any apartment or house that you’re going into, can be hiked up by any number at all.” 

'Supply is dwindling all the time' 

Co-presenter Ciara Kelly described herself as someone who was “not on the side of landlords, I’m on the side of supply”. 

Despite this, she admitted that any reform will be "politically really unpalatable”. 

“It is so easy for the opposition to hit the Government with the eviction stick and ‘you’re not protecting tenants enough’ - all that kind of stuff,” she said. 

“It has been a challenge for the Government to even do anything about this. 

“The issue is that supply is dwindling all the time, which has a negative impact on tenants that is far greater than the impact of anything else. 

“How to address that? All the experts tell us we need to remove Rent Pressure Zones and that our Rent Pressure Zones are among the most stringent and punitive in the world. 

“So, I think this has to be done; I don’t know if it’s enough, I don’t know if it’s going to be falling between two stools.” 

A housing development under construction in Cork. Picture by: David Creedon / Alamy Stock Photo.

Ciara added that whatever the merits of the reform, the Government will take an “absolute pasting and kicking from the opposition over it.”

“I think this has to be done in some way because we see an exodus of investors and even small landlords from the market,” she said. 

“Whereas this is exactly the right move, I don’t know.” 

Last year, 30,330 new homes were built in Ireland - fewer than the 32,525 built in 2023.

Main image: Ciara Kelly in the Newstalk studio. Image: Newstalk