Opposition parties have widely criticised comments by the Taoiseach over plans to consider proposals to encourage more private developers to build housing and phase out rent pressure zones (RPZs).
The Dail was told that renters are “bracing themselves” for a rise in rent following Micheal Martin’s comments at the weekend.
Fianna Fail and Fine Gael have come under renewed pressure to tackle the country’s housing crisis after it emerged that 30,330 homes were built last year, far short of the projected 40,000 new builds put forward by the parties.
Speaking at the weekend, Mr Martin said that more private investment is needed to boost rental supply as the state is already investing “huge” amounts to subsidise the sector.
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A 2% cap on rent increases per year in certain areas, also known as rent pressure zones (RPZs), was introduced in 2016 to attempt to dampen spiralling rent costs.
These regulations are due to expire on December 31 this year.
Mr Martin said they will examine whether to abolish the RPZs by the end of the year.
Sinn Fein’s spokesman for housing Eoin O Broin told the Dail that during the election campaign, Fine Gael promised to retain the RPZs.
“Your own party’s manifesto said you would review the effectiveness of RPZs, and there is no mention at all in the programme for government of ending the caps,” Mr O Broin said.
“But on Sunday, Micheal Martin suggested just that. He said that the government was considering replacing the RPZs when they expire at the end of the year. And I have to say his comments read like the speaking notes of the industry lobbyists for institutional investors.
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“The more important point is they have caused real concern among renters. I’ve been inundated with emails and with phone calls.
“I cannot stress the impact the Taosieach’s comments have had renters.”
Labour leader Ivana Bacik accused the Taosieach of “weakening” protections for renters through proposals to end the RPZs.
The Dublin Bay South TD also said that ending the measure or “prioritising tax breaks for developers” was raised during the general election campaign.
“Indeed, Fine Gael even committed to retaining rent pressure zones and your own party’s manifesto, committed only to continue to review them,” Ms Bacik added.
Speaking to Minister for Public Expenditure Jack Chambers, she added: “On the same page that you boasted about capping rents using RPZ legislation, no indication that you’d be pulling the rug from underneath renters, removing the safety net that is there.
“The Taoiseach has warned your TDs to brace themselves for raft of unpopular decisions on housing. But renters that we are all hearing from every day since the Taoiseach’s announcement on Sunday, renters are bracing themselves, facing the fear that their monthly bills will further skyrocket.”
Mr Chambers claimed the government is advancing further housing policy options.
“I want to be very clear that the Taoiseach said that he is open to the possibility of developing an alternative system to rent pressure zones, which protects renters but also enables people to have a clear, stable environment in which to invest,” Mr Chambers said.
“This is not about increasing rents for tenants, it’s about increasing supply, which will ultimately reduce rents.
“I think it’s incumbent on all of us in this house to be willing to examine all policy options and look at different approaches and models, because it is clear we need to build more homes in this country, and we need to increase the pace at which we build them.
“We know the Department of Finance analysis that to build 50,000 homes will require 20 billion euro investment capital per year, and I expect the state’s role in that context to grow.
“But we have to ensure that the investment environment, to ensure that we’ve more homes for people to rent, that we can strengthen the affordability for future homeowners, is part of the overall picture when it comes to housing policy.
“So let me be clear, we have to undertake a review of this. It’s in advance of the legislative time frame of the end of this year, and Minister for Housing will coordinate that.”
Acting leader of the Social Democrats Cian O’Callaghan accused the Government of using “dodgy data” to back its housing targets.
Mr O’Callaghan said: “You’ve just been caught out as Government using dodgy housing data, talking about 40,000 homes completed last year, and just now in the Dail, you’ve told us that work commenced on 60,000 homes in 2024.
“That’s using the same dodgy data based on commencement notices filed and then housing sites lying idle, which has been happening all around the country.
“Now, don’t take my word for that minister. This is what Property Industry Ireland, the lobbyists for the investment funds that you listen to so much. This is what they said at the weekend about the 60,000 commencement notices in 2024. They said they will not, in fact, manifest in completed units.
“That’s the lobbyists for the developers, saying those 60,000 homes will not, in fact, end up in completed homes. So you might listen to them, if you won’t listen to us.”