Eoin Ó Broin (Dublin Mid West, Sinn Fein) | Oireachtas source

I move: "That the Bill be now read a Second Time."

I thank the Minister, Deputy O'Brien, for attending. It is a truism but one which cannot be said enough that rents in the private rental sector are simply too high. For too many people renting privately, the cost is far too expensive. New rentals in Dublin now cost more than €2,000 per month, with average rents in the capital running at more than €1,700. Elsewhere in the State, new rentals are €1,400 per month and the cost is even higher in many urban centres. The latest data from the Residential Tenancies Board, RTB, published in March, show a 5.4% increase in rents since the same month last year. While the latest price report from daft.iein June showed that Covid-19 was having some impact on the market, it was, at best, a modest impact. The report showed that asking rents were up 0.5% on June of last year. The uncertainty in the student market is having little visible impact on the private rental market. In fact, daft.ie, in its student housing report this week, recorded rises in student rents throughout the State compared with last year.

The much talked about shift of short-term rental units into the long-term market has failed to materialise and what new stock is coming on stream is high-end, build-to-rent housing. In some parts of the capital, this new and exceptionally expensive stock is lying vacant. Month on month, the number of tenancies registered with the RTB continues to fall. According to figures I got from the board last week, there has been a loss of 3,295 registered tenancies so far this year. Since January 2017, the first month in which registered tenancies started to fall, we have lost an astonishing 20,000 such tenancies from the private rental stock. Accidental and semi-professional landlords are taking advantage of the return of positive equity and getting out of the market. Despite repeated calls by me and others to the previous Minister to address this disorderly exit of landlords from the market, the problem continues to get worse.

Unfortunately, the future for many renters looks bleak. At best, prices will stagnate as demand far outstrips supply. For many, rent increases will remain a fact of life. Thousands, if not tens of thousands, of renters will continue to pay excessive prices to keep a roof over their heads. Research from the Economic and Social Research Institute, ESRI, in 2018 showed that 70% of lower-income renters pay up to 40% of their income in rent. These are people who are not eligible for the housing assistance payment, HAP, rent supplement or the rental accommodation scheme, RAS. The latest Central Statistics Office, CSO, deprivation data, published this month, show an increase in deprivation rates among renters, from 27% in 2018 to 34% in 2019. As we know, all of this was before the Covid-19 crisis.

Since then renters have been disproportionately affected by lay-offs and income loss. A huge number of people on the pandemic unemployment payment are younger or lower income workers in sectors such as tourism, entertainment and retail, and the economic impact of the pandemic has hit this group particularly hard. While there is no doubt that the Government's income supports have helped, today many of these people will be hit by cuts to the pandemic unemployment payment of between €200 and €400 per month.

Research published by the ESRI and the Department of housing in July suggests that the impact of Covid-19 income loss on renters' arrears was likely to be limited. The report's conclusion contained a stark warning, however. It said that the longer the economic impact of Covid went on, the greater the chance of struggling renters falling behind on their rent. In fact they urged the Government to be cautious about withdrawing income supports too quickly. Unfortunately the advice was ignored. The Government also ignored the advice of advocacy groups such as Threshold and Focus Ireland when it ended a ban on evictions, notice to quit and rent increases for the vast majority of renters in July. Instead, the Government provided a limited protection for a smaller group of tenants and within days Deputies across the House were, I am sure, receiving calls from tenants who had received notices to quit or indeed rent hikes. I spoke to a woman who lived outside Dublin, not in my constituency and not in a rent pressure zone. She did not qualify for the Government's limited protection and her landlord had increased the rent by €100, the second such increase in two years. Her income had fallen by 20% due to Covid-19 but she was not in arrears, not on any Covid payment and not eligible for the limited supports provided by the Government. Families such as these need our protection. Their rents are simply too high and they cannot afford any further increase. The consequences of refusing to provide them with any relief will be increased financial hardship, increased emotional stress, greater poverty and deprivation and, unfortunately in some cases, the loss of a tenancy and possible homelessness.

The Minister says he wants to promote home ownership and that is a good thing. When he was on the Opposition side of the House, he rightly complained that high rents were locking first-time buyers into a rent trap, and he was correct. They could pay rent or save for a deposit but not both. For some, this not only delayed the date when they would eventually own their own home, but they were also forced to put off starting a family. For others, the choice was worse: to live at home with family into their late 30s just to save a deposit. Then there are those in the latter stages of their working life, some of whom may have lost their family home due to relationship breakdown, others due to mortgage distress or repossession. They are fearful of a life of perpetual uncertainty and unaffordability in the rental sector. The Bill I am proposing tonight is for all of these people. It would protect young and low-income renters from further rent hikes, give older renters greater certainty into the future and help those desperately trying to save to buy their own home.

A three-year ban on rent increases for existing and new tenancies is just one of a package of measures which Sinn Féin urged the last Government to take on board and we are doing so again with the new Government. A ban on rent increases is not enough of course. The cost of renting must also be reduced and that is why Sinn Féin has repeatedly called for a refundable tax credit for private renters worth a full month's rent. That would put an average of €1,400 back into the pocket of every renter in the State. We also need to see a massive investment in affordable cost-rental accommodation, led by local authorities, approved housing bodies and community housing trusts. Much was promised by Fine Gael and supported by Fianna Fáil in budget 2019. The Taoiseach and Tánaiste claimed this was a housing budget and our current Minister made great play of his role in securing €300 million to be committed to the delivery of 6,000 affordable homes by 2021 in the serviced sites fund. To date, not a single affordable home has been delivered under this scheme. In fact, only 50 are currently under construction in Dún Laoghaire-Rathdown, and these will not be tenanted until next year at a cost of €1,200 per month. In my view, and that of many working people, this is not affordable for the vast majority of working renters. We need thousands of affordable cost-rental homes delivered every year with rents somewhere between €700 and €800 per month. This can and should be done by this Government if they are serious about tackling the crisis in the rental market and meeting the affordable housing need.

We also need to reduce the over-reliance on the private rental sector to meet social housing need. This will only happen if the Government revises its social housing targets upwards. The 10,000 real social homes which it has committed to delivering next year is not enough. We have over 90,000 households living in the private rental sector on social housing supports. We need a plan to provide these families with real social housing which will in turn free up even more properties in the private rental sector for private renters or indeed first-time buyers. We also need further reform of the private rental sector. We need a real move to tenancies of indefinite duration, not just the removal of section 34(b) of the Residential Tenancies Act. We need improved inspection and enforcement of minimum standards and fire safety through an NCT-type certification for landlords. We need a comprehensive reform of the tax treatment of landlords which ends the appalling tax breaks for institutional investors while allowing good professional landlords to get a fair return when providing a good service. Rebuilding Ireland has failed renters. The rental market is in fact in a worse place today than it was when the then Minister for housing, now the Minister for Foreign Affairs and Trade, Deputy Coveney, launched his strategy for the private rented sector in 2017. Only a comprehensive reform providing security and affordability for tenants and landlords will suffice. Sinn Féin's Ban on Rent Increases Bill 2020 is one important piece of the package of measures needed to give renters a break and I have no hesitation in recommending it to the House.

Before I conclude, I note that the Minister was in my own constituency today and welcome it. He was out in Adamstown surveying progress in the strategic development zone, SDZ, funded by the local infrastructure housing activation fund, LIHAF. The Minister was rightly very critical of the slow pace of the LIHAF funding over the last number of years. Just last year he rightly complained that just €16 million out of €200 million had been spent. Adamstown is an interesting example because €20 million was promised back in 2016 and 2017 with the condition that the 2,000 LIHAF-facilitated units were to be delivered by 2021 and only a fraction of them have been. The Minister will be interested to know that very close to where he was standing there was an estate called Shackleton Park built by Cairn Homes and facilitated under the LIHAF. Some 229 of those homes were sold this year by Cairn to what the Minister has on many occasions described as cuckoo funds. If one looks on daft.ie today one will see a two-bedroom home is now for rent in Shackleton Park at €1,800 per month and a one-bedroom home, which is quite small, for €1,500. The vast majority of the discounted units that were committed to - and this is no fault of the Minister as he was not responsible back in 2016 and 2017 - have not been delivered. The 400 large or discounted units are not guaranteed at the price of €320,000 or less because they are linked to inflation and construction prices, both of which have increased considerably since the original agreement was made in 2017.

I raise this issue because if the Minister is considering renewing or adding to the local infrastructure housing activation fund in the budget, he needs to ensure he does not repeat the mistakes of his predecessor. He needs to ensure funding only goes to developers who need it. Cairn Homes did not need it, as it made over €68 million in net profit last year and €56 million the year before. The Minister needs to ensure LIHAF delivers the homes within the time it is meant to and that there is genuine affordability, as was promised, through LIHAF and Rebuilding Ireland but which has not been delivered. I raise this as a genuine issue of concern because the Minister shared many of my concerns before his appointment. He is now in the driving seat and has the influence to ensure any future infrastructural funding is tied very clearly to timeframes for delivery and genuine affordability for working families.

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