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27/10/2021

Rents rises out of control in Laois where average rents surge by 10% beyond €1,000 a month

Rent Pressure Zone is not stopping landlords hiking rents beyond legal cap

rent

Average rents surge past €1,000 a month in Laois despite supposed protection of rent caps covering most populated parts of the county

A system which is supposed to protect tenants from big rent rises is not to be working in Laois according to the latest official figures which also show an annual increase of more than 10% beyond €1,000 a month.

New data from the Rental Tenancies Board (RTB) also shows that the Laois rents are rising at a faster rate than the national average and the county. Laois is also now in the Dublin commuter counties or Greater Dublin Area in terms of the scale of rent charged by landlords.

Most contentiously, the report shows that rules restricting rises do not appear to be complied with by some property owners. The permitted rises in Rent Pressure Zone caps in Portlaoise, Portarlington and Graiguecullen is being exceeded significantly.

The findings are contained in the (RTB) quarterly Rent Index for the April to June period (Q2) of 2021. This report is compiled in conjunction with the Economic and Social Research Institute (ESRI). The RTB says it is the most authoritative report of its kind on the Irish rental market.

It finds that the average cost of renting in Laois has risen above €1,000 a month to €1,014.98. This contrasts with €917.47 charged to rent a home in Laois for the same time in 2020. The rise marks a 10.6% increase. This is above the 7% year-on-year average rise across Ireland.

The latest rise also makes Laois one of the most expensive counties to rent in Ireland. It is one of ten counties where average rents exceed €1,000 a month.

Laois had the sixth highest quarterly rate of rent increase and the ninth highest annual rate.

While rents are rising, the supply of new homes is not following the demand. Just 0.9% of all new tenancies agreed in Ireland between April and June were found in Laois.

The RTB also reports on 166 Local Electoral Areas three of which are in Laois. Two of the Laois LEAs are Rent Pressure Zones (RPZ) which means landlords are supposed to be legally prevented from upping rents by more than general inflation rate which is now 1.6%. Landlords were originally allowed a 4% rise.

The RTB found that rents went up in all three areas of Laois by an average greater than 7%.

The Portlaoise district also includes Abbeyleix and Ballinakill. The average rent in the district which is dominated by the county town is now €1,072.89 per month. 

The average rent in Graiguecullen - Portarlington district is now €1,009.55. The RTB found that rents rose by more than 7% in the LEA in each of the first two quarters of 2021.

The district also takes in Stradbally, Timahoe, Killenards, Ballynan and Killeshin. It borders Kildare, Offaly, Carlow and Kilkenny. Part of the district is located besided Carlow town.

The Portlaoise and Portarlington - Graiguecullen Municipal Districts are Rent Pressure Zones where rents are supposed to be controlled.

Where landlords circumvent the legislation in relation to RPZ rent caps, the RTB has the power to investigate and apply sanctions, with fines of up to €15,000 and/or costs up to €15,000.

The Borris-In-Ossory -Mountmellick LEA is not a Rent Pressure Zone but it could now qualify. The RTB fund that rents in the largely rural areas are now €955.13 a month. The rent has gone up by more than 7% in each of the last four quarters. The year on year growth rate in the area is now between 15% and 25%

The area also includes Mountrath, Rathdowney, Durrow and Clonaslee.

One of the criteria to be declared a Rent Pressure Zone is that the annual rate of rent inflation in the area must have been 7% or more in four of the last six quarters. MORE BELOW IMAGE.

Since 1 July 2019 the RTB says it has analysed over 1,000 contacts from members of the public around Ireland to its dedicated Investigations channels as well as data from the RTB’s own systems, open source data from rental websites and advertising platforms, and data shared with the RTB from local authorities, to identify potential breaches of rental law that can be investigated.

To the end of quarter 2 2021 almost 400 investigations were approved. The RTB says the most common allegation investigated to date is breach of Rent Pressure Zone requirements. Over 80 decisions have been made by the independent decision makers. All sanctions must be confirmed by the Circuit Court and once confirmed, the Court Order is issued to the landlord and to date almost €260,000 has been refunded to current and former tenants as a direct result of the investigation process.

The RTB adds that it will publish the particulars of sanctions confirmed by the Circuit Court on the RTB website. To date 29 cases have been confirmed; the highest sanction to date was €3,000 (comprising €1,500 fine and €1,500 costs).

 

Some of the key national findings in the report are as follows: 

  • National rents in Ireland grew by 7% year-on-year in Q2 of 2021 – this growth rate is the highest since a rate of 7.4% in Q1 2019.
  • Year-on-year rent price inflation in Dublin stood at 4.4%, and outside Dublin at 10.4%.
  • The national standardised average rent stood at €1,352 in Q2 2021 – an increase of €32 compared to the previous quarter.
  • In Q2 2021 in Dublin, the standardised average rent in Dublin stood at €1,848 per month, which was significantly higher than the rent levels outside Dublin (Non-Dublin) where the standardised average rent was €1,058 per month in Q2 2021.
  • The standardised average rent in the GDA (excluding Dublin) stood at €1,397 as of Q2 2021.
  • The standardised average rent outside of the GDA in Q2 2021 was €1,007.
  • The county with the fastest growing rents in Q2 2021 was Leitrim, at 17.3% year-on-year growth.
  • Laois, Sligo, Wicklow, Mayo, Offaly, Kilkenny, Longford and Clare all had annualised growth above 10% in Q2 2021.
  • Dublin and the GDA accounted for over half (58%) of all tenancy agreements registered in Q2 2021.

This report is based on actual rents paid on 13,884 private tenancies registered with the RTB in the quarter, compared to 16,085 in Q1 2021. MORE BELOW GRAPHIC.

Pádraig McGoldrick, Interim Director of the RTB, commented on the latest Rent Index findings: “In Q2 2021, the Irish economy began to emerge from lockdown with a phased reopening, and people began to readjust to their living and working situations. The Q2 2021 Rent Index provides an important insight into how the rental sector is adapting to these changes. From the initial early pandemic slowdown and reduction in rent levels, rents nationally have rebounded quickly, mainly driven by activity outside of Dublin. In particular, rents are continuing to increase more rapidly along the commuter belt and more slowly in Dublin and other urban areas indicating that the pandemic has seen an immediate impact of people moving from urban areas, particularly Dublin. This may reflect an emerging trend around long-term working and lifestyle choices.

Nevertheless, there is a lot of uncertainty around the emerging trends. It must be noted that the period since the onset of the pandemic has seen the introduction and subsequent easing of restrictions in line with the public health measures. This is likely to have had an effect on the trends throughout 2020 and 2021 which may not be permanent. In addition, the latest rent levels have not been impacted by recent rent control measures restricting increases in rents to rises in inflation measured by the Harmonised Index of Consumer Prices (HICP). The RTB will continue to monitor the trends to inform policy and support emerging needs in the sector.”

Mr McGoldrick added: “While the latest rent levels will not yet have been impacted by the change in rules for rent setting introduced in July, the level of increase in Q2 2021 is a source of concern and, while there may be legitimate reasons reflecting the rate of increase, it may also indicate an unacceptable level of non-compliance by landlords with rent setting regulations restricting rent increases in Rent Pressure Zone areas (RPZ). The impact of not complying with these measures can be very severe, and the RTB is committed to ensuring increased compliance with these requirements.

The RTB says that where landlords circumvent the legislation in relation to RPZ rent caps, the RTB has the power to investigate and apply sanctions, with fines of up to €15,000 and/or costs up to €15,000.

As of quarter 2 2021, the RTB has commenced almost 400 investigations into improper conducts and to date almost €260,000 has been refunded to current and former tenants as a direct result of breach of rent setting rules.

The RTB says that on the basis of a request from Minister Darragh O’Brien, the Minister for Housing, Local Government and Heritage, the RTB will escalate its response and introduce an accelerated and focussed campaign to identify and, where necessary, pursue those who abuse or ignore their rent setting responsibilities.”

RTB advice for renters

For anyone experiencing issues in their tenancies, the RTB says they should visit www.rtb.ie for information on how to resolve issues and, if necessary, use the RTB’s free telephone mediation service on 0818 30 30 37. This is available to help both landlords and tenants resolve a dispute in a mutually beneficial manner and does not require people to leave their home.

The RTB says that if a tenant believes that a landlord has unlawfully raised the rent in their tenancy, they can make an application to the Dispute Resolution Service of the RTB. For anyone experiencing issues in their tenancies, please visit www.rtb.ie for information on how to resolve issues and, if necessary, use the RTB’s free telephone mediation service on 0818 30 30 37. This is available to help both landlords and tenants resolve a dispute in a mutually beneficial manner and does not require people to leave their home.

In order to better enforce RPZ legislation, the Residential Tenancies (Amendment) Act 2019 also provided the RTB with enhanced powers and resources to carry out investigations and to sanction landlords if required, for a contravention of the RPZ restrictions, amongst other improper conducts. Where landlords circumvent the legislation in relation to RPZ rent caps, the RTB has the power to investigate and apply sanctions if improper conducts are found to have occurred, ranging from a formal written caution and/or a fine of up to €15,000 and/or costs up to €15,000.

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