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Dublin: 12 °C Thursday 23 October, 2014

Column: The private rented sector is heating up dramatically – yet fails to meet basic needs

Rent are rising but our pay packets aren’t. Why? Because our housing strategy is based almost exclusively on debt-fuelled private home ownership, writes Mick Byrne.

Mick Byrne

THE PRIVATE RENTED sector is heating up dramatically – all you need to do is talk to someone currently looking for a place to know that things are moving rapidly in the sector. What’s going on, and why?

Consider three elements of the Government’s strategy. First of all, the Government’s housing ‘strategy’ is almost completely reliant on private home ownership. Second of all, the Government’s strategy for stabilisation of the financial sector involves promoting house price increase and the deleveraging of banks, which means lending out less money to re-balance their books. And finally, wage decreases – these are, so we’re told, central to increasing Ireland’s ‘competitiveness’ and therefore attracting foreign direct investment.

So what does this add up to? If you’re lucky enough to have job, you can expect stagnant or decreasing wages, great difficulty in getting a mortgage and increasing house prices. Needless to say, this is not a favourable context for a housing strategy based almost exclusively on debt-fuelled private home ownership.

Renters really have just one option…

Once upon a time, the response to market failure with regard to basic social needs, in this case one which – and this worth underlining – no one can live without, was public provision. Not anymore, and this means those who can’t get into owner occupancy won’t be getting into social housing either. In fact, the social housing waiting list had doubled in recent years.

This leaves us with one option – the private rented sector. Hence the enormous demand for rented accommodation in Dublin and the increasing prices. There’s a domino effect here too. Those who in another era would have progressed on the road to home ownership (especially young couples in employment) are staying in private rented. These guys are getting all the best places, but they’re paying the price for it too. Landlords initially reduced rents when the crisis kicked off, but they’ve gradually realised that a housing crisis is also an investment opportunity and they’re pumping prices as a consequence. And the more you pay in rent, the more difficult it is to save for a deposit on a house.

Meanwhile, those next down the pecking order are squeezed into inferior private rented housing stock as they scramble to find any accommodation at all. And this situation is made all the worse by the existing problem of substandard housing. In 2009 an official inspection of 18,000 houses nationally revealed that 41% of private rented dwellings in Dublin city were sub-standard. The Centre for Housing Research, in an earlier report, found that for dwellings accessed by tenants in receipt of rent supplement 78% were below the legal minimum.

The situation is near breaking point for many

For many, young people, students, migrants, and unemployed people in particular, the situation is near breaking point. A quick look on any of the rental websites will tell you that landlords are picking and choosing, refusing to accept rent supplement and generally giving the cold shoulder to any one they don’t like the look of. If you’re on rent supplement or in one of Ireland’s many marginalised groups – in particular travellers, Roma, young working class people and those with mental health difficulties – you’ll know what this means in practice. This can also cause problems for those who lose their job only to find their landlord won’t take rent supplement – and so losing a job can mean losing a home.

The refusal of landlords to accept tenants on rent supplement is of particular significance. It has long been argued by housing experts, such as UCD’s Michael Punch, that rent supplement is a bad way of meeting housing need. It represents a significant monthly transfer of public money into private hands, while social housing suffers from lack of investment. However, it’s equally important to note that subsidising private landlords to provide housing for those who are officially recognised as being in housing need is deeply problematic because landlords can, and do, discriminate. And tenants, have no way to appeal or challenge their arbitrary opinions and personal preferences.

Tenants suffer an acute lack of political representation

But whether or not your rent is subsidised, as demand piles on the rental sector our right to housing will continue to be undermined, a right which is recognised in the Universal Declaration of Human Rights, to which our merry Republic is a signatory.

And yet, despite the important work of advocate groups such as Threshold, tenants suffer an acute lack of political representation. With all the focus on home owners, none of the political parties have prioritised the issues we face. Perhaps this is because the sector is generally populated by groups with low election participation, or because it’s seen as transitory – a mere stopping point on the way to home ownership. Either way, scarce credit and dwindling social housing will no doubt see increasing pressure on the sector.

The interesting question is whether or not those of us who pay by the month to put a roof over our heads will step forward to demand these issues are addressed and place our right to housing on the agenda.

Mick Byrne is an Irish Research Council Post-Doctoral Scholar at the National Institute for Regional and Spatial Analysis and participates in the European Action Coalition for the Right to Housing and the City.

Read: Charity found homes for 51 homeless children last year

Read: Home-building at fastest rate in nine years as industry ‘turns corner’

Read: Rise in Dublin house prices masks fall in every other part of the country

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