merrion street

-All RPZs will be extended to end of 2024-
-4% cap on rent increases in RPZs will be replaced by restriction of inflation under Harmonised Index of Consumer Prices-
- Will result in far lower rent increases for tenants-
The Minister for Housing, Local Government and Heritage, Darragh O’Brien TD, has received Government approval for the reform and extension of the Rent Pressure Zone (RPZ) model.
Key provisions are set to be inserted into the Residential Tenancies (No. 2) Bill 2021, published on 17 June, to reform the rent increase restrictions in RPZs. These reforms will take effect upon the passage of the Bill, expected by July 9th.
The current cap of 4% on annual rent increases will be replaced and rents in RPZs can now only go up, if necessary, in line with general inflation as recorded in the Harmonised Index of Consumer Prices (HICP). This will result in far lower rent increases for the estimated 74% of all tenancies which are in RPZs. HICP averaged 0.73% over the past three years.
For those outside of RPZs, the provision for bi-annual rent reviews will be extended for an additional three years from 1 January 2022 to 31 December 2024. This provides rent certainty for tenants outside of RPZs for a minimum 2 year period at a time.

Commenting Minister O’Brien said:

“Improving the standards, security and affordability for renters is a priority for me and for the Government. We are making significant changes in recognition of the fact that tenants continue to face persistent pressures in the rental and housing markets.
“I have always acknowledged that for some, the 4% cap on rent increases in RPZs became a target rather than a limit. We are now taking action to ensure that tenants will only pay rent increases, if required to, which are in line with general inflation, which is currently below 2%.
“The linkage with the HICP respects the constitutionally protected property rights of landlords and aims to safeguard continued investment in the sector by existing and new landlords to deliver the requisite supply of high-quality rental accommodation.
“In addition to significantly reducing the level of rent increases in RPZs, the Bill will also restrict the level of upfront payments required of tenants, to a total value that does not exceed two months’ rent to cover any deposit and one month rent in advance. We are also extending protections for those most impacted by COVID-19, in arrears and at risk of losing their tenancy. Such tenants will be protected from rent increases and/or evictions to January 2022.
“All tenants, including students and the most vulnerable tenants, are set to gain significant protections under this Bill,” concluded Minister O’Brien.
**ENDS**

**Note to Editor:**
The Residential Tenancies Board (RTB) will establish and maintain a new RPZ calculator and publish a table of relevant HICP values to assist with the lawful setting of rents in RPZs.
The RTB will be empowered to sanction any contravention by a landlord of the new rent increase restriction in RPZs linked to HICP.
The Harmonised Index of Consumer Prices measures the change over time in the prices of consumer goods and services acquired, used or paid for by Euro area households. The term “harmonised” denotes the fact that all the countries in the European Union follow the same methodology.
The State continues to provide immediate support to families and individuals in private rented accommodation under the Department of Social Protection’s (D/SP) Rent Supplement scheme and other State supports such as the Supplementary Welfare Allowance and the Pandemic Unemployment Payment. These State payments can help tenants to resolve their financial difficulty and to meet their obligation to pay rent.
The RTB and the Money Advice and Budgeting Service are also available to help and tenants are urged to reach out for assistance.
It remains the position that a moratorium on evictions can re-activate under the Residential Tenancies Act 2020 anytime and anywhere a 5 km travel restriction is imposed.
The Residential Tenancies (No. 2) Bill 2021, when enacted, will also provide for a number of rental protections including:
• The extension of the targeted protections which are in place for those negatively impacted by COVID-19, in arrears and at risk of losing their tenancy. Subject to the eligible tenant making the necessary declaration, they can be protected by rent increases and evictions until January 12th 2022.
• Restrict any upfront payment of rent or deposit to secure a tenancy to a total value that does not exceed two months’ rent i.e. to cover any deposit and one month rent in advance.
• Provide enhanced protections for students. Those in student specific accommodation will also be covered by the new restrictions on any deposit payable and advance rent payments. Students can, if they so wish, opt out from the upfront rent payment restrictions. The Bill also provides that the notice period required to be given by students in respect of student specific accommodation will be limited to a maximum 28 days’ notice. A student can choose to provide a longer period of notice.