Seanad debates

Wednesday, 17 November 2021

Residential Tenancies (Amendment) (No. 2) Bill 2021: Second Stage

 

10:30 am

Photo of Darragh O'BrienDarragh O'Brien (Dublin Fingal, Fianna Fail) | Oireachtas source

I thank all the Senators — Senators Buttimer, Black, Warfield, Murphy, Moynihan, Garvey and Cummins — for their contributions. It is very much appreciated that they took the time to put their views across.In case I forget, I inform the House now that I intend to introduce some technical amendments to section 5 on Committee Stage in the interests of clarity.

I greatly appreciate Senator Black's constructive contribution and those of Senator Moynihan and others. The Bill is not a silver bullet and, as they highlighted, there are other steps we need to take. This is the sixth item of tenancy legislation I have brought forward. We need to improve security of tenure for tenants, which the Bill will do, and reduce the cost of rent, which I fundamentally believe can be done properly only by increasing supply.

One important part of increasing supply relates to the cost-rental model. With Senator Buttimer, I had the pleasure of visiting Lancaster Gate in Cork, where there is a really impressive development that will result in significant volumes of cost-rental homes. Throughout the country, there is real potential to secure State-backed rents at well below the market rate. Rents have been too high for some time. The issue has been exacerbated by a shrinkage of supply post Covid, with large quantities of savings and competition for properties. It is not a phenomenon just in this country but throughout Europe, including in what were previously stable markets such as those in the Netherlands and Germany. In the North, year-on-year inflation in rents stands at 13.1%, and there are none of the kinds of protections I am introducing with regard to caps.

I welcome the support from across the House for what we are doing. The significant move towards tenancies of indefinite duration and the change in regard to Part 4 tenancies are really important. We might park the politics for a moment. Any measure we take in the rental market has to be calibrated and has to take into account the individual mom-and-pop landlords who own these properties. We cannot tread on their rights either. Any legislation is potentially open to challenge. Worse than that, we could continue to see a flight of decent landlords from the market, and there are decent landlords in the market.

I remind Senators - I am sure they know this - that 98% of tenancies are fine and only 2% of tenancies end up in dispute. Even so, they are an important 2%, and we need to ensure the Residential Tenancies Board, RTB, is resourced to deal with that and that local authorities are resourced to carry out inspections. We have doubled the funding into the RTB for 2022 and it has a great deal of important work to do. Senator Black mentioned Threshold. It is running the Own Your Rights campaign, funded by my Department working in conjunction with Threshold, John-Mark McCafferty and his team. People need to know their rights and we need to improve them. The legislation is important in the sense of setting a cap on rent increases but it is not a target. Landlords do not have to increase rents and many do not, which I welcome. We had to address in the summer, with everyone's support, the issue of 8% increases due to the roll-over of 4% plus 4%. That had, unfortunately, become a target.

To those who call for a blanket rent freeze, I say we need a little honesty in that space. I do not say this in any disrespectful way, but I ask those who seek a freeze whether they have carried out any research on the consequences of a blanket rent freeze or of a continuation of a blanket eviction ban, in the context both of that being challenged and of the flight of properties and reducing supply, making circumstances even worse. Senator Cummins gave the example of one city that is always held up as one of the exemplars of rental in Europe, namely, Berlin, and what has happened there. I am not accusing anyone who has contributed to this debate but there are some who will simply throw out proposals such as freezing rents and banning evictions and say they will sort the issue out, but they will not. We need to increase supply and have a sustainable rental market where people's rights are protected, which is what I want.

Fundamentally, we want to increase supply across the board with, as Senator Black referenced, mixed tenures. That is what Housing for All is about, with 300,000 new homes, public and private, that is, both social, affordable and cost rental as well as private homes. There are people who want to buy homes and there are some who want just to rent. We have an opportunity to provide cost rental at scale for working people who do not want to buy and who want to secure tenures, and they will get that. There will be thousands of them over the coming years and it has started already. That shows what is possible.

Furthermore, we need to utilise our own lands through the LDA, which was referenced by Senator Moynihan, and ensure we break ground on the land we own ourselves, which we are going to do next year. We have passed and amended the Land Development Agency Act. The agency is now funded to the tune of €3.5 billion and can get on and build, something I want to happen. Some parties do not, however, and that is fine as a political position some have, whereby they just want an agency that manages land and farms it out to the local authorities. I do not think the local authorities can resolve the housing crisis on their own. The public sector cannot resolve the housing crisis on its own. We need every part of both public and private working together, focused on a plan, which is now Housing for All.

I thank all Senators for their contributions. As I said during the debate last night, we will examine any amendments they wish to table. Nevertheless, this is urgent legislation, as they know, because we need to pass it to ensure we can provide that certainty of the cap of 2% or the HICP inflation rate, whichever is the lower. We need to make great strides on securing tenancies further through the changes we are making to Part 4. I thank the Leas-Chathaoirleach and all my colleagues in Seanad Éireann for the constructive way in which they have engaged in the debate on this important legislation, which needs to be passed as expeditiously as possible.

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