Friday 20 January 2017

FG attacks 'outrageous' threat to impose new charges on tenants

Published 17/12/2016 | 02:30

Demands: Fianna Fáil housing spokesman Barry Cowen. Photo: Tom Burke
Demands: Fianna Fáil housing spokesman Barry Cowen. Photo: Tom Burke

The Government has downplayed threats of a backlash by landlords in response to a new law aimed at capping rent increases at 4pc per year.

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The move by Housing Minister Simon Coveney caused three days of bitter political rows with Fianna Fáil, underpinning the minority Coalition, and other Opposition parties who have said the measure was not good enough. But Mr Coveney persisted with the legislation, which Government colleagues argue is a first important move in bringing order to a chaotic rental market, especially in Dublin and other large population centres.

The Dáil last night backed Mr Coveney's rental control plan. TDs voted by 52 to 43 in favour - but there were 25 abstentions, mainly from Fianna Fáil, which effectively allowed the measure to become law. The Dáil vote means the draft law will go to the Seanad next week for the senators' approval.

A group representing landlords has, however, warned some of its members may withdraw from State-subsidised rent schemes and introduce a series of new charges for tenants on things such as keys, parking, and administrative costs to claw back what the group has said are heavy revenue losses.

"The measures being introduced are so severe that rents will not cover costs and devaluation of property will be significant - all adding to the exit of the investor," said Stephen Faughnan, chairman of the Irish Property Owners Association (IPOA), which said it had 5,000 members.

But Government chief whip Regina Doherty rejected the IPOA arguments, and said this was an "outrageous" warning. "It is statements like that which give landlords a bad name," she said. She also questioned how many property owners the organisation actually represented.

Ms Doherty defended the new law, and said it would help tenants keep their homes by moderating rent increases. She thanked opposition parties for their help in ensuring passage of the measure, despite difficulties, including a mistake in the drafting process, which caused further delay yesterday.

But the IPOA said it was seriously contemplating its strategy for the future. The rent caps are expected to apply in rent pressure zones covering all of Co Dublin and Cork city from January.

The cities of Limerick, Waterford, and Galway, and Dublin's commuter belt, are expected to be included from later in 2017. Other parts of the country can then be designated as rent pressure zones.

Much of the delays were due to demands by Fianna Fáil's housing spokesman Barry Cowen, who said he wanted an earlier extension of the rent pressure zones.

Mr Cowen also unsuccessfully called for a halving of the rent increase to 2pc.

Following a row over mistakes in the legal text, Mr Coveney said his department had checked the new wording to ensure rents in designated areas would not increase by more than 4pc per year.

Irish Independent

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