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Rental Market

Tenants bidding against each other for limited accommodation is raising rents, RTB chair says

He was criticised for saying renters should pay more for accommodation provided by institutional landlords as it provides security of tenure.

THE CHAIRMAN OF the Residential Tenancies Board (RTB) has been criticised for saying renters should pay more for accommodation provided by institutional landlords as it provides security of tenure.

Tom Dunne also admitted that this view means “effectively” only those on high wages can access security of tenure through paying the higher rents that institutional landlords charge.

The comments come after the Irish Examiner reported that Dunne said yesterday the best type of rental accommodation people could have in the private market is with vulture fund-owned properties.

Speaking on RTÉ’s Today with Claire Byrne programme, Dunne said that in the case of small or accidental landlords, they can end the tenancy if they want to use it themselves or to sell it on.

“In the case of a fund, or an institutional landlord, their business is renting so they’re not going to want to get vacant possession because they want the tenant in there, and secondly, they can’t regain possession for family use.

“So effectively you’ve got indefinite security of tenure if you’re renting from one of those funds.”

He continued: “In any market you pay more for reliability. If you’re in the second-hand car market, you will pay more for a car that has a reliable reputation than one that has not got a reliable reputation.”

He said that institutional funds charge more to rent their properties than smaller landlords because “they are offering a product that has dimensions which are more attractive to tenants and therefore tenants who are attracted by that will pay more and they will bid out people who are on a smaller income.”

“What I’m saying is that this notion, I think it is a notion there, that landlords charge what they want in the market is not quite the whole story.

“Because what happens is that tenants in a market where there’s a shortage of accommodation, bid against each other to get that available accommodation. So it’s demand that’s increasing rents.

“People who supply accommodation are price takers in the market.”

When asked whether these views represented a ‘let them eat cake’ line, Dunne said “absolutely not”, and added “it’s just a recognition of reality”.

“I am not saying rents should go up … they should come down. But what I’m saying is the way to get them down is to increase supply,” he said.

When asked whether those who have a lot of money are the only people who can access security of tenure, Dunne said “that’s effectively where we are really”.

Responding to comments, Labour housing spokeswoman Senator Rebecca Moynihan said security of tenure should not just be available for renters who can pay the most.

“For the RTB to suggest that some landlords, namely investment funds, are better than others, is perverse. If renters had decent rights in the first place, it would level the playing field.

“We totally lag behind other countries on renters’ rights. Renters are expected to put up with extortionate rents, evictions at the drop of the hat and many can’t make the place feel like a home.

“The balance of power in the rental market is heavily weighted towards landlords.

“They control price, security of tenure, whether or not you can have a pet, where you hang your washing, even the furnishings of your home.

“We all know that investment fund landlords are arm’s length landlords. We in Labour believe that all landlords should provide all renters greater security of tenure. The security of keeping a roof over your head simply can’t be linked to your ability to pay above and beyond the odds.”

Labour’s Renters’ Rights Bill proposes a three-year rent freeze, a ban on no-fault evictions, and a register where people can access the rent rates paid at a rental property.

Press Association
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