LABOUR deputy Jan O'Sullivan has criticised the Government for not designating Limerick and Waterford as rent pressure zones, saying the consequences could prove “disastrous” for those already struggling to pay increasing tents in the city.
The last survey of the rental market in Limerick showed that rents increased by over 13% in the third quarter of 2015 to the same period in 2016, rising to on average of €862 in the city.
The Labour party’s spokesperson on Housing, Planning and Local Government, said the move by the Minister for Housing, Simon Coveney, will be “disastrous for tenants who are already struggling to pay and now face rises they can't afford.
“When I spoke in the Dáil before Christmas on the Government's Housing Bill, I warned that the criteria to qualify for a four per cent cap on rent increases per year were too restrictive, especially relating to hikes in four of the last six quarters.
“Unfortunately my fear that places like Limerick might lose out has come to pass,” she said.
“Linking rent increases to the Consumer Price Index as the Labour Party has proposed would have been a much fairer way to go.
“The people of Limerick, Waterford and other parts of the country are now left with no protection from steep hikes, which is a direct result of this legislation,” said deputy O’Sullivan.
It has been announced that rent caps have been extended to 24 further areas as part of the Government's attempts to tackle spiralling rents across the country.
The Minister Coveney has published the list of new rent-pressure zones, which will see the caps come into force immediately.
The caps were introduced in Dublin and Cork cities before Christmas after agreement was reached between Fine Gael and Fianna Fáil.
The new list of zones includes Galway city, as well as 23 towns in Cork and along the Dublin commuter belt.
These include Bray in Co Wicklow, Naas, Celbridge and Newbridge in Co Kildare, and Laytown-Bettystown, Ashbourne and Ratoath in Co Meath.
The areas were finalised on the back of recommendations by the Residential Tenancies Board and the Housing Agency.
For towns to be designated as a pressure zone the average rent has to be above the national average and prices must have increased by seven per cent in four of the last six quarters.
Landlords can increase rent by only four per cent a year for the next three years in designated zones.
Minister Coveney has acknowledged that supply was the most important issue that needed to be addressed.
“Over the medium term, additional supply is the right way to address rental pressures. We need to ensure the supply side response is strong and swift by implementing the full range of complementary supply measures contained in the rental strategy,” said Minister Coveney.
Sinn Fein deputy Maurice Quinlivan said that “many low income families are paying up to 60% of their disposable income on rent. Constant rent increases only exacerbate this problem.”