Blog 17_ Rent Freeze

Would I support a Rent freeze, someone asks? I would certainly like to see rents stabilise but I am worried whether or not a rent freeze would work right now. Maybe we can achieve the same effect in another way.

Landlord representatives claim a rent freeze would drive more smaller landlords out of the market thus reducing supply and making matters worse. Others dispute this, but it is generally held that a rent freeze is good for tenants in situ but very bad for those looking for a place to rent.

Landlords see the issue of tenant rights as a zero sum game. Whenever new rights are proposed for tenants, landlords claim the net effect will be to subtract rights from them.

According to the Daft.ie Rental Price Report Q3 2024, average monthly market rents were as follows:

Dublin EUR 2,476 up 5.2%, Cork City EUR 2,077 up 10.4%, Limerick City EUR 2,221 up 19.2%, Galway City EUR 2,189 up 10.5%, Waterford City EUR 1,659 up 5.8% and Rest Of Ireland EUR 1,586 up 8.3%.

These are the rates for new tenancies and the figures for those remaining in a rented home would have been lower. Even so the figures are stark, particularly for Limerick, which is now on a par with Cork and Galway. Economic growth in Limerick has been strong, but there has been almost no new housing supply, something the new Mayor is determined to rectify.

Professor Lyons of TCD, commenting on the daft report, showed a very interesting correlation for Dublin between numbers of apartments built and rent rises that year. In years when apartment building was low (2018 - 2022), rents rose substantially, but, in years when the number of apartments built was high (around 9,000 in 2023), there was a virtual rent freeze. It looks as though we can take apartments completed in a year as a proxy for private rental properties coming to the market and potentially apply this country wide. To complete the picture: in 2024 apartment building in Dublin fell back and rents have started to rise again.

So it seems we can engineer a natural rent freeze if we build enough apartments. As with house prices, so too with rents, it all comes back to supply. In my Blog post no 4, I have shown how thousands of new "living above the shop" rental properties could be brought to market. This would make a substantial difference but, in the longer term, the Government's Housing for All plan, which has been tilted towards social homes, will need to make provision for more private rental properties as well.