Jan O'Sullivan (Limerick City, Labour)
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18. To ask the Minister for Housing, Planning, Community and Local Government if he will review the criteria used to designate areas as rent pressure zones, particularly the use of local electoral areas, LEAs, in view of the fact the basis for calculating qualification makes it difficult for certain portions of LEAs to qualify, even if they are experiencing high rental increases; and if he will make a statement on the matter. [16797/17]

Simon Coveney (Cork South Central, Fine Gael)
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When rent pressure zones were introduced in Dublin and Cork in December last year, only Housing Authority areas could be designated as rent pressure zones because the necessary information on rents was not available to decide whether smaller administrative areas met the criteria for designation.  At that time, I made a commitment that my Department would work with the Residential Tenancies Board (RTB) to ensure that more refined data was available to allow for more specific targeting of the measure to other areas of the country where severe pressures were being experienced.

Close collaboration between the RTB and the Economic and Social Research Institute (ESRI) has resulted in the revision and development of the methodology for producing the RTB's Rent Index so that we can now use the RTB data to calculate and monitor changes in average rents at the level of Local Electoral Areas (LEAs). The new approach recognises that the same pressures do not apply equally in all parts of the country.  It provides a significantly more detailed understanding of market behaviour in the rental sector and an objective evidence base required to appropriately target the Rent Predictability Measure introduced last year and designate the correct areas as Rent Pressure Zones.

The new methodology allowed me to make an order on 26 January 2017 designating 12 Local Electoral Areas as rent pressure zones in parts of counties Cork, Galway, Kildare, Meath and Wicklow.  On 29 March 2017, I made a further two orders designating Maynooth and Cobh.  Altogether, some 57% of tenancies nationally are now located in rent pressure zones. 

The legislation only allows for Housing Authority areas or Local Electoral Areas to be designated as rent pressure zones.  For the purposes of the Act, ‘area’ is defined as either the administrative area of a housing authority or a local electoral area within the meaning of section 2 of the Local Government Act 2001. There is no provision for any other type of area to be designated as a Rent Pressure Zone.

I have undertaken to carry out a review, in June this year, of the Rent Predictability provisions introduced under the Planning and Development (Housing) and Residential Tenancies Act 2016. At that point, the provisions will have been in place for 6 months and it will be possible to ascertain their effectiveness and whether any changes need to be made. The issues the Deputy raises in relation to the areas that can be designated as rent pressure zones will be considered in the context of that review.

John Brady (Wicklow, Sinn Fein)
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19. To ask the Minister for Housing, Planning, Community and Local Government the reason his Department omitted Greystones, County Wicklow from the rent pressure zones list; and if he will make a statement on the matter. [17115/17]

Brian Stanley (Laois, Sinn Fein)
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28. To ask the Minister for Housing, Planning, Community and Local Government if he will review the decision not to impose rent caps in County Laois and the remainder of County Kildare. [16818/17]

Simon Coveney (Cork South Central, Fine Gael)
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I propose to take Questions Nos. 19 and 28 together.

The Planning and Development (Housing) and Residential Tenancies Act 2016 lays out the process through which rent pressure zones can be designated.  It provides that the Housing Agency, in consultation with housing authorities, may make a proposal to the Minister that an area should be considered as a Rent Pressure Zone. Following receipt of such a proposal, the Minister requests the Director of the Residential Tenancies Board (RTB) to conduct an assessment of the area to establish whether or not it meets the criteria for designation and to report to the Minister on whether the area should be designated as a Rent Pressure Zone.

On 24 January 2017, the Housing Agency proposed that 15 Local Electoral Areas, including Greystones, should be considered for designation as rent pressure zones. On foot of the proposal from the Housing Agency, again in accordance with the Act, I requested the Director of the RTB to make a report to me as to whether these areas met the criteria for designation as Rent Pressure Zones.

On 26 January 2017, I received a report from the RTB confirming that, based on rent data from Quarter 3 2016, 12 out of the 15 Local Electoral Areas examined met the criteria and I made Orders designating those 12 areas as Rent Pressure Zones on 26 January 2017.  In relation to Greystones, the RTB reported that, although the average rent there was above the average national rent, annual rent inflation had not been above 7% in four of the previous six quarters.  Accordingly, Greystones could not be designated a rent pressure zone.

On 29 March the RTB published the Rent Index Report in relation to Quarter 4 2016, which includes a summary of the data used as the criteria for designating rent pressure zones in relation to all Local Electoral Areas in the country, allowing all interested parties to see exactly where their area stands in relation to rents and possible designation.  On the basis of this data  and in accordance with the procedures set out in the Act, I signed orders designating Maynooth and Cobh Rent Pressure Zones with effect from 30 March 2017.

The most recent data shows that no other local electoral areas meet the criteria for designation at this time. The average rent in Greystones is above the national average, but the annual increase in rents in Greystones has been less than 7% in four of the last six quarters.  In Athy, the only Local Electoral Area in Kildare that is not a Rent Pressure Zone, and in all of Laois, the average rent is well below the national average. Currently none of these areas can be designated.

Under the Act, I have no further role or discretion in proposing areas for designation as Rent Pressure Zones or in deciding whether they should be 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.

I have undertaken to carry out a review, in June this year, of the Rent Predictability provisions introduced under the Planning and Development (Housing) and Residential Tenancies Act 2016. At that point, the provisions will have been in place for 6 months and it will be possible to ascertain their effectiveness and whether any changes need to be made to, for example, the qualifying criteria or the designation process.