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Dublin: 17°C Monday 18 October 2021

Opinion: Generation rent? The bloated housing market must be curbed by rent controls

Priced out of home ownership, relying on sublets and owing only what can snugly fit into a car boot – we no longer live in homes, only houses.

Lorraine Courtney Freelance journalist

THE RENTAL GENERATION, rental Ireland, generation rent – whatever you choose to call it, our housing market is changing. But for generation rent, priced out of home ownership and being coerced into a peripatetic lifestyle of sublets and 12 month contracts, owing only what can snugly fit into a car boot, we no longer live in homes, only houses. My own story of having had about 20 different addresses over the past decade is far from unusual. But even more crucial is the fact that there are thousands of us out there right now stuck in expensive rental homes and desperately insecure tenancies.

Data from Census 2011 show that 28.8 per cent of households now rent their accommodation. The Census also shows that, between 2006 and 2011, there was a dramatic increase in the share of households in private rented accommodation. Between 2006 and 2011 the number of households in Ireland increased by 187,000 or almost 13 per cent, to 1,649,000, while the number of households renting increased by 160,000.

Surrendering half our wages to landlords

We are also limply surrendering half our monthly wages to landlords. The average rent nationwide is now 9 per cent higher than it was at the same stage last year according to the latest quarterly Rental Report by Daft.ie. Rents rose in every county outside Connacht and Ulster, with the biggest annual increase of 14 per cent occurring in Dublin city centre. Rents in Dublin’s neighbouring counties of Wicklow and Kildare also witnessed a significant increase of 9 per cent. And the average rent nationwide is now €888.

Last Friday, the Irish Times interviewed renter Joanne Martin who had been renting with her partner and their children, seven-year-old Alex and five-year-old Hannah, for the past two years in Naas, Co Kildare. The semi-detached house on the outskirts of the town costs €950 a month, but their rent is due to increase in August. Based on price rises for similar homes in the area, it could increase to anything between €1,200 and €1,300 per month. “We won’t be able to afford it,” she said. “We don’t get rent allowance or anything like that, so everything we have at the moment is going on paying the monthly rent. All we have left after we pay our bills is about €40 for food.”

If more evidence were needed of the emergence of the issues here then Dublin encapsulates them. Every landlord and his dog seem to be getting in on the act. By simply re-mortgaging an existing property and using the proceeds to buy the vacated flat down the road, a landlord gets himself an apparently guaranteed source of income and capital growth. What could possibly go wrong? The result is constrained supply. But more than anything, growing rentier activity in the housing sector has become symbolic of the fact that wealth and income seeming to be ever more concentrated in the hands of a relatively small, privileged minority.

What’s the solution?

The answer is two words: rent control. In parts of Europe, controlled rents and long leases on well-maintained properties in areas where people would actually choose to live are the norm. Just look at the German rental market with its protections against eviction, longer term tenancies, higher quality property and regulated rent increases. In Denmark tenants in pre-1991 homes benefit from regulated rents based on the landlords’ costs plus a fixed profit and a landlord cannot decide to raise rents by more inflation unless agreed. And one in five French people rent and long leases are available, with rent caps available in some areas. French landlords can only evict those who default on rent, damage the property or breach their contract.

Controlling rents and extending tenure periods will probably discourage some people from becoming landlords or be a disincentive to existing ones to extend their property portfolios. It may even encourage some to sell. If so, it should have the effect of slowing the seemingly unstoppable rise in house prices in Dublin at the moment. Would-be first-time buyers, who now have to compete with buy-to-let landlord investors, will find their main competition limited to others in the same position as them on the property ladder. But most of all an individual landlord’s greed cannot be the only thing determining what we should pay for our home.

Lorraine Courtney is a freelance journalist. Follow her on Twitter @lorrainecath.

Read: The average rent in Dublin is now €1,289 – in Waterford it’s €601

Read: Dublin woman refusing to leave rental property until she can find a new affordable home

About the author:

Lorraine Courtney  / Freelance journalist

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