Rent pressure zones are bad for tenants, a group representing landlords has claimed. 

Since 2016, rent in homes located in RPZs cannot be increased by more than 2% a year. 

The system was introduced to protect tenants who found their rent was surging as the economy began to recover in the aftermath of the crash.  

A report on the issue has been delivered to the Department of Housing and Minister James Browne is due to brief Cabinet tomorrow on its conclusions. 

It is understood Minister Brown will recommend changes on the grounds that the status quo is deterring investment in housing. 

On Newstalk Breakfast, Irish Property Owners Association spokesperson Mary Conway said her members would welcome any change that allows them to increase their tenants’ rent by more than the current maximum of 2%. 

“What we would like to see is that rents could be reset between tenancies to market rent,” she said. 

“Or if a property is being sold that there would be the option for a new purchaser, a new investor to buy the property and let it at market rent. 

“We know that landlords are leaving the market; we don’t know exactly how many people have left but we know landlords are leaving. 

“Other landlords aren’t purchasing those properties because of the rent cap. 

“They’re being purchased by first time buyers, so they’re not being lost to the market - but they’re being lost to the rental market.” 

An apartment building under construction in Palmerstown, Dublin. Picture by: Noel Bennett / Alamy.com.

When asked if this would mean tenants paying even more to rent a home, Ms Conway denied that was the case. 

“We know from looking at what happened in Finland, they had a very similar situation a few years ago,” she said. 

“Yes, rents did rise marginally but then new investors came into the market, so there was much more supply and choice for tenants. 

“So, rent in fact fell; there is only a certain price point for anything. 

“If rents are too high, the property will be left vacant and the property owner will eventually have to bring a reasonable level.” 

Apartments in Dublin. Picture by: Sam Boal/RollingNews.

Ms Conway continued that “rent gouging isn’t in anyone’s interest” and claimed that RPZs are bad for tenants. 

“What we have suggested is that rents will be increased by 4% for four-years and then go to market rent at year five,” she said. 

“We know that most tenancies last for a maximum of about four-years. 

“So, the thing about it is, people are not being able to move, they’re stuck in what we would call ‘golden handcuffs’. 

“Where you’re afraid to move because you’re on a very low rent and you could be commuting long distances because there’s no other choice. 

“So, until supply comes up, there’s no choice for anybody.” 

In February, Tánaiste Simon Harris urged caution on the matter of reform to RPZs, noting that renters are already “extremely overburdened”.

He added that Fine Gael had promised in the General Election that in Government they would, “Maintain the Rent Pressure Zone framework to help keep rent increases under control in high-demand areas.”

Main image: A landlord handing over keys to a tenant. Picture by: Alamy.com.