RENTS – RPZ LEGISLATION CONTINUES TO RATCHET UP RENTS - IPAV
Commenting on the latest Daft.ie Rent Report for Q2 2023, IPAV, the Institute of Professional Auctioneers & Valuers, said Rent Pressure Zone legislation has served to increase rents, as the Institute has warned for several years.
Pat Davitt, IPAV Chief Executive said agents are seeing more properties on the market for rent and RPZ rules are responsible for some of the larger increases captured in the latest report..
“The latest unintended consequence of RPZ legislation is, agents report, landlords not already within RPZ rules increasing rents every two years, according to legislation, but arising from the fear of their areas coming within the rules and their being consequently, and potentially, unable to achieve market rent for a considerable period, regardless of increasing costs, including higher interest rates,” he said.
Mr Davitt said RPZ rules have served to inflate rents form their introduction in December 2016.
“As we’ve said previously, on the introduction of the RPZ system some landlords rushed to rapidly raise rents before the door closed, without a doubt contributing to rent inflation that would otherwise not have happened,” he said.
“Others who didn’t do so got caught in a prolonged lower rent cycle, with limited ability to increase rent, and facing responsibility for upkeep of properties, increasing interest rates and no protection from irresponsible tenants.”
Writing in The Irish Times in March 2023 Professor John FitzGerald, Professor Emeritus, at the Economic & Social Research Institute (ESRI) said:
“Rent controls are a short-term fix that usually turn into a long-term problem. Once in place, ending restrictions becomes increasingly problematic. The long-term effect is to curb supply of rental properties, raise overall rent levels, and ultimately damage the interests of tenants and potential tenants.”