Gerard Craughwell (Independent) | Oireachtas source

I thank the Cathaoirleach. Much has been made of the constitutional nature or otherwise of rent regulation. However, some limited rent regulation already exists in the 2004 Residential Tenancies Act. Recently legal advice offered, thanks to Senator Hayden, by a practising barrister, on rent regulation stated there is no constitutional impediment to rent regulation. The barrister stated that rent certainty was constitutional and in the interest of the common good and social justice. A solution to the problem of huge sudden increases in rent is to tie rental increases to the rate of inflation as determined by the consumer price index, CPI. This would ensure a more steady approach to rents as they would be linked to the cost of living in the country rather than on sudden swings in the property market. This would give tenants more certainty but should also guarantee landlords a steadier income flow.

I want to be fair to both sides. It is important that we take on board some of the concerns of the landlords. I know property owners will argue that regulation will result in insufficient income to maintain standards, their properties will fall into disrepair and overall there will be a reduction in accommodation available. They have stated that an analysis of the supply impact shows that, potentially, between 52,000 and 89,000 rental properties could exit the sector over time due to the impact of net yields for landlords. Rents tend to be higher the greater the contraction in supply due to black market transactions. In light of this, any regulation must bring with them certain guarantees for landlords and those guarantees must form a part of regulation that is brought forward.

Another argument put forward by property owners against rent regulation is that such regulation destabilises rental markets and have a negative effect on labour mobility. The solution is to have an efficient, fair and swift judicial system. I have seen evidence from landlords and property owners where people have walked away. I have seen one landlord left carrying the can for €65,000 in unpaid rent across his properties. I can understand there is a need for swift action where there are deviant tenants. I fully support the move while calling for regulation at the same time.

With rent regulation there must be a review of the unfair and inequitable tax treatment which is driving investors out of the private rental sector. Investment in property is a business after all; it is not a hobby. Buying a property in order to rent it out is a fairly major undertaking. There must be a realistic approach from a tax point of view. Landlords must be allowed to claim 25% of interest paid to purchase or renovate a property and that is a reasonable request. The local property tax for landlords should be allowed to be offset against tax also.

Security of tenure is a serious issue. One year leases must stop if we are talking about long-term solutions for families because a family could move into a property and a year later find themselves on the street. A major weakness in the Residential Tenancies Act 2004 is that landlords can vacate a property on grounds such as required for a family member, intending to refurbish the property or selling the property. The notice of termination of lease is wholly inadequate for tenants, with some tenants who have lived in properties for more than two years given only 56 days notice to vacate the property. With a shortage of rental properties on the market at the moment, many families are faced with an impossible dilemma of finding a similar property in the same location at a similar rent to what they were paying. This has a detrimental effect on families with children who attend schools in a particular area. Only last week Fr. McVerry contacted my office to inform me about a case where a young single mother with a three-year old child was made homeless and lived on the street who goes to his premises at night seeking accommodation. That woman has to report to a Garda station each night in order to receive emergency accommodation.

I compliment the Minister of State and the Minister, Deputy Kelly, on the marvellous job they have done with respect to the people who sleep rough. That accommodation is now full. I compliment them both on the measure but we have got to go a little bit outside that initiative.

I am concerned about the properties that were purchased originally as buy-to-let properties. They are now being repossessed by banks and the banks are absolutely heartless. The receivers move in and their job is to take the property back and take ownership of the property. With respect to deposits and things like that there is no requirement for banks to refund deposits. We must protect tenants who are in properties that are owned or repossessed by banks. If tenants are paying their rents and are good and obedient tenants there is no reason they should be asked to leave a property.

The next issue is standards in rental properties. I note the point the Minister of State made in his speech. Standards in rental properties have increased over time. In terms of the inspection system that is operated at the moment, I have received complaints from landlords that minor problems result in the lack of certification which causes all sorts of problems. We need a realistic approach to the inspection regime.

Bedsits are another issue that has been raised with me. I am not talking about the dingy hovels that we used to have years ago. In Waterford city, which is not far from where the Minister of State comes from, there are a number of what I call bedsits on the old Cork Road or the Cork Road, if I am not mistaken and they are located on either side of the road. It is where elderly people can rent a room with bathroom facilities and all amenities are in one room. If he has not seen them then I ask him to take a look at the accommodation. It is an excellent solution where somebody does not want to find themselves meeting the costs of a single apartment.

In conclusion, I thank the Minister of State once again for taking the time to listen to me and I appreciate the Cathaoirleach allowing my amendment.