Business Property & Mortgages

Wednesday 21 August 2019

Kelly urges legal action as landlords plan hikes to beat cap

Alan Kelly. Photo: Tom Burke
Alan Kelly. Photo: Tom Burke
John Downing

John Downing

Former environment minister Alan Kelly has urged Government legal action against a landlord group that threatened new tenant charges in response to a new law capping rent increases.

Mr Kelly has written to Isolde Goggin, chairperson of the Competition & Consumer Protection Commission (CCPC), calling on her to open an investigation into the Irish Property Owners' Association (IPOA).

The IPOA issued a statement at the weekend that said landlords would impose a range of levies, charges and other measures in response to the new measure.

The Labour TD unsuccessfully tried to curb rents during his term in charge of housing policy from 2014-2016.

But his efforts to link rent increases to the consumer price index were torpedoed by the Finance Department, which argued that it would be undue interference in the rental market.

Housing Minister Simon Coveney pushed through a measure in the Dáil late on Friday that would see rental increases in key areas capped at 4pc a year for the next three years.

TDs voted by 52 votes to 43 and the abstention of Fianna Fáil TDs facilitated the measure, which will now be considered by the Seanad this week.

Mr Kelly said the landlords' threatened action breached competition law.

"It is my view, having sought legal advice, that the statement issued by the IPOA - if carried out - is a breach [of law]. I have written to the chair of the CCPC asking her to launch an immediate investigation into the potential infringement of competition law," he said.

"If it is clear that such a breach is being threatened, or given effect, then it is incumbent on the CCPC to commence proceedings in the High Court.

"This would ensure that the IPOA gives a declaration that it will comply with the provisions of the Competition Acts.

"Furthermore, if there is any evidence that the IPOA has attempted to impose any of their proposals, the CCPC should immediately forward the evidence to the DPP with a view to criminal charges being brought.

"We cannot have a situation where a so-called representative association can threaten to engage in criminal activity that has been outlawed by the Oireachtas under the Competition Acts."

But Mr Kelly also said he believed the IPOA only represented a small number of landlords. He said the vast majority of landlords act in a fair and law-abiding manner.

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 also be designated as rent pressure zones.

But the IPOA group, which says it represents 5,000 landlords, warned it may withdraw from State-subsidised rent schemes.

They are also considering a series of new charges for tenants on things like keys, parking and administrative costs to claw back some costs.

"Property owners could not get sufficient income to maintain their property. The measures being introduced are so severe that rents will not cover costs, and devaluation of property will be significant," the IPOA warned as the draft law was making its way through the Dáil.

Government chief whip Regina Doherty rounded on the IPOA, saying it was an "outrageous" warning.

"It is statements like that which give landlords a bad name," she said, questioning how many property owners the organisation represents.

She defended the new law.

Irish Independent

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