The Daily Star Ireland
A new report from the Organisation for Economic Cooperation and Development (OECD) has recommended a major shift in Ireland’s rental regulations, suggesting that landlords should have the freedom to adjust rents between tenancies.
This proposal comes as the Irish Government conducts a review of existing rent controls, amid concerns that strict limits on rent increases are discouraging institutional investors from financing new housing developments.
Current Rent Controls and OECD’s Recommendation
Under the existing Rent Pressure Zone (RPZ) regulations, landlords cannot raise rent by more than 2% annually, even when a new tenant moves in.
The OECD report argues that this restriction should be relaxed, allowing landlords to set new rental prices whenever tenants change.
According to the findings, the current rent cap keeps rental prices below the cost of property maintenance, which could be driving landlords out of the market and discouraging new investment in home construction.
Concerns Over Government Housing Policies
The OECD report also cautions against reintroducing tax incentives as a strategy to stimulate homebuilding, amid speculation that the Government is considering such measures to address the housing crisis.
Additionally, the report is critical of two existing government schemes, Help to Buy and First Home, suggesting that they might be contributing to rising house prices rather than improving housing affordability.
As the Irish Government reviews its housing policies, the OECD’s recommendations are likely to spark debate over balancing tenant protections with the need to attract investment in housing development.
