Malcolm Noonan (Carlow-Kilkenny, Green Party) | Oireachtas source

While acknowledging the intent of this amendment, I am not in a position to accept it.

The established practice in the residential rental market, in accordance with section 19(1) of the principal Act, is for a landlord to set a rent that is no greater than the prevailing market rent for a particular tenancy. Section 24 of the principal Act defines market rent in terms of a tenancy of a dwelling to mean:

the rent which a willing tenant not already in occupation would give and a willing landlord would take for the dwelling, in each case on the basis of vacant possession being given, and having regard to— (a) the other terms of the tenancy, and

(b) the letting values of dwellings of a similar size, type and character to the dwelling and situated in a comparable area to that in which it is situated.

It is a matter for the landlord to ensure that he or she does not exceed market rent. A tenant can refer a dispute on the amount of the rent set to the Residential Tenancies Board. In addition, a determination order can be made for the rent to be reduced and damages, to a maximum of €20,000, paid to the tenant.

Section 19(5) of the Residential Tenancies Act provides for an exemption from the RPZ controls only in relation to the first rent setting of a new tenancy where the dwelling is, or is in a protected structure or proposed protected structure within the meaning of the Planning and Development Act 2000 and has not been let in the previous 12 months, or no tenancy in respect of that dwelling subsisted during the period of two years immediately preceding the date on which the tenancy concerned commenced. These exemptions only apply to the first rent setting under the tenancy in a RPZ. Thereafter, rent increases are prohibited from exceeding general inflation, as recorded by the harmonised index of consumer prices or the proposed 2% cap per annum pro rata, whichever is lower. If accepted, this amendment would negatively impact on the investment in and supply of rental accommodation in the medium to longer term. I am sure that Senators will agree that this would be a very unwelcome and unintended consequence of the measure.

While affordability remains an issue, the introduction of RPZs in 2016, and their subsequent enhancement in 2019, in July of this year and proposed here in this Bill, have played and will play a key part in moderating rent increases. RPZs were a considered measure that balanced the needs of tenants with the legal rights of landlords and the imperative to ensure that rental housing supply was not adversely affected. We need to encourage landlords to provide much needed accommodation in the private rented sector. This measure would drive away investment from the sector. A landlord will need to be able to set a rent that he or she considers does not exceed the market rent.

The RTB's quarterly rent index report, that is produced in conjunction with the Economic and Social Research Institute, ESRI, captures the number of bedrooms in an individual rental property. However, due to the number of tenancies registered each quarter, this information is only reported at regional level. The RTB has considered providing this information at a county level but there were not a sufficient number of new registrations in each quarter to support this granular analysis. This matter will be reviewed after annual registration is introduced in quarter 1 of 2022, when the RTB expects to have between 60,000 and 70,000 renewals each quarter that may enable more granular reporting.

On the median rent amount, the quarterly rent index report does not currently include the median rent in an area. Again, this matter can be reviewed following the roll-out of the requirement for the annual registration of tenancies within the RTB.

The RTB's quarterly rent index report provides the standardised average rent both nationally and at regional levels, including local authority levels. The standardised average rent refers to the development of an average that is consistent over time to changes in different property types or characteristics of a tenancy that may evolve within the market. The standardised average rent can, therefore, be compared over time without concern for underlying changes in the data or sample.

I confirm that I cannot accept the amendment. I encourage any tenant who faces what appears to be an unlawful rent level to refer the dispute to the RTB for determination.