Housing Ireland magazine
RPZs containing rent increases The future use of rent controls “should be considered an essential part of the rental market policy tools”, an Economic and Social Research Institute (ESRI) study has suggested. The recommendation comes after an assessment by the ESRI found that the introduction of Rent Pressure Zones (RPZs), aimed at holding rent increases to 4 per cent a year in designated urban areas between 2017 and 2020, has been successful in limiting rent inflation. The report warns that any removal of stabilisation measures would likely lead to further upward price pressure on a rental market already likely to experience considerable pressure as the economy looks to recover from the profound effects of the Covid-19 pandemic. According to the research, rent in pressure zones would be some 2 per cent higher on average if controls were not implemented, however, it also found that more than one third (34 per cent) of landlords within RPZs rose rent rates above the allowable limit. While landlords are allowed to apply for exemption from that rent increase cap under certain criteria (just over 800 exemptions have been registered since July 2019), the ESRI said that it could not ascertain whether all the exceeding rises were legitimate or whether they represented breaches of the regulation due to “data gaps” in Residential Tenancies Board (RTB) statistics. Rent stabilisation measures were first introduced into the Irish private rental sector in 2016 to address concerns around affordability challenges for private renters amidst a period of rapid inflation in rental process. Specific areas designated as RPZs were imposed with a 4 per cent annual cap in rental inflation. Since then, a large number of additional areas have been classified as RPZs and in
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