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ESRI says affordability pressures for renters 'likely to worsen'

Renters are more likely to work in the sectors worst hit by the pandemic.

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RESEARCH PUBLISHED TODAY found many renters face long-term affordability pressures as they are more likely to work in the sectors worst hit by the pandemic.

The research was done under a programme of work between the Department of Housing, Planning and Local Government and the Economic and Social Research Institute (ESRI) to examine the short-term impact of the pandemic on rental affordability and missed payments for private renters who were not previously in receipt of State housing supports.

The research found that one-in-three renters who had missed payments had faced considerable affordability challenges prior to Covid-19.

Despite the closure of many businesses during the lockdown as well as cuts to pay in many companies, the ESRI said economic pressures are not likely to have worsened during this time because of reduced spending in other areas such as childcare, transport and recreational activities.

However these savings are “very short-term” and unique to a time in which households had been advised to stay at home and restrict their movements, the research stated.

“Many renters face longer-term affordability pressures that are likely to worsen quickly, as necessary expenditure rebounds quicker than incomes,” the ESRI said today.

“As renters are more likely to work in sectors badly hit by the pandemic (such as accommodation and hospitality, this may pose longer-term employment challenges if these sectors are slow to recover.”

Last week the government confirmed the Pandemic Unemployment Payment (PUP) is to be extended until April but the support will be tapered over time, eventually reducing to the standard jobseeker payment of €203. 

Rachel Slaymaker, author of the report and a post-doctoral research fellow at the ESRI, said any tapering of the State income supports will “have a disproportionate effect” on renters who were previously working in these sectors.

Speaking about the research today, Housing Minister Darragh O’Brien said it will guide policy, in particular the the measures taken to regulate the rental sector.

“I urge households experiencing difficulties making rental payments as a result of the pandemic to apply for Rent Supplement and I will stress that this government is committed to improving the standards, security and affordability for all renters,” he said.

Today the minister brought a new bill before the Dáil which he said was aimed at protecting tenants. For tenants who are unable to pay their rent due to Covid-19 between the passing of the bill and 10 January next year, the legislation provides for an increased notice of eviction period from 28 days to 90 days.

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In the longer term tenants will have 28 days to pay rent arrears before a notice of termination can be served. The ban on evictions that was put in place during the lockdown will not be extended. 

Minister O’Brien said anyone who receives a termination notice  this year cannot be evicted from their property earlier than 11 January 2021. 

Social Democrats TD Cian O’Callaghan said it is important that the huge collective national effort to suppress Covid-19 is not undermined now by government proposals to “bring back evictions on most grounds for all renters”.

“More than 75% of notices to quit are issued by landlords who want vacant possession of their property and there will be no protection under the Government bill for any tenants served with a notice to quit on these grounds. There is absolutely no justification during a pandemic for putting tenants at risk in order to make more homes empty,” he said.

“I am tabling a number of amendments to the Residential Tenancies and Valuation Bill 2020 to improve security of tenure for tenants and to make the private rented sector more viable and secure – I am calling on the government to accept these amendments.”

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