John Paul Phelan (Carlow-Kilkenny, Fine Gael) | Oireachtas source

First, I beg the indulgence of the House as I have not read a script in 15 years, so if I get lost I will try to correct myself.

The way in which an area is designated as a rent pressure zone is set out in the Planning and Development (Housing) and Residential Tenancies Act 2016. The 2016 Act amends the Residential Tenancies Act 2004 to provide that the Housing Agency, in consultation with local authorities, may make a proposal to the Minister that an area should be considered for designation as a rent pressure zone. On receipt of such a proposal, the Act provides that the Minister must then request the director of the Residential Tenancies Board, RTB, to conduct an assessment of the area to establish whether it meets the necessary criteria for designation and to report to the Minister on whether the area should be designated as a rent pressure zone. Where the Residential Tenancies Board confirms that an area satisfies the criteria for the area to be designated, the Minister then has a statutory obligation to make an order designating that area as a rent pressure zone.

An area cannot be designated as a rent pressure zone unless it meets the criteria set out in the legislation. These criteria are that the annual rate of rent inflation in the area was 7% or more in four of the last six quarters and that the average rent for the area in the last quarter was above the average national rent in the RTB’s rent index report in the last quarter, which is €987 per month for the first quarter of 2017.

On 15 June 2017, the RTB published the rent index report relating to the first quarter of 2017, which includes a summary of the data used as the criteria for designating rent pressure zones in respect of local electoral areas in the country. This allows all interested parties to see where their area stands with regard to rents and possible designation. The data from the rent index report relating to KelIs, Navan and Trim is included in the report and indicates that the annual rate of rent inflation in Trim and Navan was 7% or more in at least four of the last six quarters, while for Kells the report shows that there was growth of 7% or more in three of the last six quarters. In all cases, however, the average rent for these areas was not above the RTB average national rent for the last quarter. Therefore, these areas do not meet the criteria for designation at this time.

Under the Act, the Minister has no further role or discretion in proposing areas for designation as rent pressure zones or in deciding whether they should be so designated. The designation process is independent and based on clear objective criteria and quantifiable evidence. The Housing Agency will continue to monitor the rental market and may recommend further areas for designation. Where, following the procedures set out in the Act, it is found at a future date that additional areas meet the criteria, they will be designated as rent pressure zones.

A review of the rent predictability measure and the system of rent pressure zones is currently under way.

The provisions have been in place for six months and data from the Residential Tenancies Board's rent index report for the first quarter of 2017 are now available. This is the first rent index covering the period since the rent pressure zone measure was introduced. Using these data, it will be possible to ascertain the effectiveness of the rent predictability measure and whether any changes need to be made - for example, to the qualifying criteria or the designation process. As part of the review, a public consultation process on the effectiveness of the rent predictability measure and the rent pressure zones was launched on 15 June 2017 and will remain open until 30 June. Further details on the consultation are available on the Departments website.

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