Thursday 17 October 2019

The big read: The faces of Ireland's rental crisis

The big read: Ireland is turning into a rental society across generations - with the number of tenants in every age group surging each year. But radical action is required to reduce stress, improve security of tenure and make rents affordable. Kim Bielenberg reports

Aengus Hennessy with his wife Latifa Krim and sons Deedee (12) and Oisin (9) at their home in Decourcey Square. Photo by Kyran O'Brien
Aengus Hennessy with his wife Latifa Krim and sons Deedee (12) and Oisin (9) at their home in Decourcey Square. Photo by Kyran O'Brien
Kim Bielenberg

Kim Bielenberg

A young couple with a toddler and a baby on the way are given notice to quit - as the landlord hikes the rent by €500 to nearly €2,000 per month.

Another young family paying high rent are told by the landlord that they can't put a cot in one of the bedrooms. So, they have to move.

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At the other end of the age scale, a woman who has lived in the same rented accommodation for 70 years is ordered out of her home. Her own parents lived in the same flat, but she has to leave.

Pensioners, forced to join a frantic hunt for affordable property with students and office workers, are consigned to live in substandard homes with mould, unfixed leaks and inadequate heating.

The student struggling to find anywhere to stay commutes up to two hours from their family home because they cannot afford to stay close to the university.

These are stories of renting in Ireland across the generations in 2019, where home ownership is fast becoming a quaint fantasy for all but the most wealthy.

As we head towards the end of the second decade of the 21st century, it is finally dawning on us that the system of housing in Ireland is now a broken model, and it is affecting our whole way of life.

Seán Moynihan, chief executive of the charity Alone, says: "Unless a solution is found, there will be pushback in the next few years because it is going to affect a lot of people who never thought they would end up in these situations."

The number of renters in the private sector has trebled in Ireland since the year 2000 to 900,000.

But Dr Michael Byrne, lecturer in Social Policy at UCD, says the Government has not adapted to this change. "So far, the approach has been one of reacting and firefighting, but there is no clear vision of where we want to go."

Traditionally in previous decades, renting was considered a transitional option on the way to home-owning nirvana.

Those on average incomes - from carpenters, office workers and plumbers to teachers, nurses and gardaí - could aspire to have a place of their own.

John-Mark McCafferty, chief executive of housing charity Threshold, says: "In Ireland we had an asset-based welfare system based on the idea of being a homeowner - and paying off your mortgage before you retire. Because you owned your home, you could live on your pension - and leverage your asset to access care."

That model has been blown to smithereens for a growing number of people since we went from boom to bust and back again.

The rise of the renting generations might be bearable if it was affordable. Even two-bedroom apartments in Dublin commonly cost up to €2,000 per month - and rents have spiralled upwards in towns and cities across the country.

It is hard enough for middle-income earners to find affordable options, and compete for properties, even when they are earning reasonable salaries.

But what will this growing cohort of families and single people do when they reach retirement age, and they still face enormous rents - without any capital built up in a home? In recent years there has been much focus on the pensions time bomb as the population ages, but there is also the looming threat of a rental time bomb.

The rapid ageing of our population will be one of the most significant social developments of the next two decades.

The number of people over the age of 65 is expected to reach 1.4 million by 2040, or close to a quarter of the total population.

At the moment, up to 85pc of people over 65 own their own homes, but that number is likely to plummet in the coming years.

According to a housing report by the charity Alone, 10pc of Irish people aged 50 to 54 rent their homes from private landlords.

McCafferty of Threshold highlights how we have moved away from the home-ownership model and this trend was already apparent in the last census.

The census of 2016 showed a 38pc increase in the number of 35-44 year old who are renting.

The trend is also evident in the older age groups with a 22pc increase in those renting between the ages of 55 to 64, and a 24pc increase among over 65s.

The Celtic Tiger crash contributed to these numbers. A significant number of renters previously owned their homes, but lost them in the crash as they could not afford the mortgage.

Another contributory factor is the rise in the number of divorced or separated people.

The emergence of the "cuckoo funds", corporate investors who are snapping up whole apartment blocks across the country, has also helped to push families into the rental sector, according to Dr Michael Byrne.

Earlier in the decade, the Government rolled out the red carpet for investment trusts with generous tax terms. Since 2012, almost 10,000 housing units have been bought by corporate investors - and 3,000 homes were bought by them last year. Many new housing schemes are now built for rent only, because developers find that they are more profitable.

"We are not victims of international funds here, because it is part of government policy," says Dr Byrne. "If your government makes attracting international capital into your property market one of its priorities, you can be sure it will make it difficult for ordinary homebuyers to compete against them."

It could be argued that corporate investors have boosted supply in the rental sector - and are more professional in their approach to looking after properties than mom and pop landlords.

But Threshold's John-Mark McCafferty says they tend to focus on the upper end of the market, and are not providing accommodation for low- to middle-income groups. They can also set a benchmark of high rents.

An Irish Government survey earlier this year showed that the majority of renters still cling to the home-owning ideal. Up to 86pc said they would prefer to buy if they had the choice. But we will have to adapt to the reality that a significant section of the population will rent in the future.

In order to reduce the stress for tenants, McCafferty believes we need to improve the security of tenure in rental properties. Threshold tackles numerous cases where landlords push tenants out for spurious reasons in order to push up the rent.

In other countries, tenants may have indefinite tenancies so long as they are paying the rent and obeying the rules. And tenants can stay put even if a property is sold. In Germany, the average length of tenancy is 11 years.

The insecurity suffered by tenants affects the cohesion of communities. They may be forced to move far away from schools, churches, friends and family - loosening community ties and creating a society of atomised individuals.

Dr Michael Byrne of UCD says we cannot rely on the market to house our population.

"If you are relying solely on the market for housing, there is a high likelihood that you will have periods of inadequate supply linked to a boom/bust cycle. You need 20-30pc of your housing to come from other sources."

Dr Byrne advocates the cost-rental model popular in continental countries such as Austria.

This means that as a tenant, you pay a rent which covers the cost of a housing body providing your home, but nobody makes a profit.

While some tenants on low incomes may be subsidised, most will simply cover the cost of the rent, which normally works out at an average of 75pc of private sector rent.

"In Austria, renting property in this way is extremely common among people of many different backgrounds, and it is not seen as a poverty alleviation measure."

The Government is supporting a few cost rental schemes, but there is little sign that they will meet the enormous demand for affordable housing from those who earn too much for social housing and too little to own a home of their own. Radical action will be required, and the desperate yearning from tenants for an affordable roof over their heads is only likely to become greater in the coming years.

'My wife was pregnant and we were told to leave'

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Edwin Mullane at his home in Raheny. Photo by Kyran O'Brien

Edwin Mullane won a wrongful termination of tenancy case against his landlord after his family were unfairly forced to leave their apartment on the Northside of Dublin.

The landlord claimed she was selling the apartment, but Edwin discovered soon after his family had left that a new tenant had moved in on a much higher rent.

"Losing your home when you have a child and your wife is pregnant is one of the most stressful things that you can go through," says Edwin, who works in the arts.

"That is why I am passionate about helping others. The more we can do to help each other be aware of tenants' rights, the more we can do to cut down stress for other families."

Edwin's wife Elaine is a yoga teacher, and they now have two young boys, aged three and one. In 2017, when Elaine was expecting her second child, the landlord told them they would have to move out, because she was selling up.

"I asked the landlord if there was any way we could stay until after the baby was born," says Edwin. "She told us she wanted an extra €500 per month for us to stay."

The apartment was in a rent pressure zone, where landlords are not allowed to hike rent by more than 4pc. So the proposed increase of €500 broke that limit.

"We said that we could not pay the extra rent of that amount. And then she said she would have to sell the place.

"She told us she was selling but she made no effort to market the property.

"We were only out of the apartment two weeks when a friend of mine told me someone had moved in - and I knew no sale could be turned around in that time."

Edwin enlisted the support of housing charity Threshold and took a case to Residential Tenancies Board, which found in his favour.

"My generation has come into this horrendous ramped up market," he says. "Unless we start complaining or take action about this, nothing will be done.

"There is very little security for tenants in Ireland. I have friends in Edinburgh, Paris and Berlin - and they are not looking over their shoulder, worrying about what might happen if the landlord calls.

"We are very positive people and we don't want to be portrayed as victims.

"We just want to raise awareness of the rights of tenants in Ireland and the work Threshold is doing."

'My retirement plan - keep working until I drop dead'

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Aengus Hennessy with his wife Latifa Krim and sons Deedee (12) and Oisin (9) at their home in Decourcey Square. Photo by Kyran O'Brien

Aengus Hennessy is one of the growing number of older tenants in their fifties who are uncertain about what happens when they reach retirement age.

The 51-year-old cabinet maker rents a house in Glasnevin with his partner Latifa Krim, an artist and teacher. They have two boys, aged 12 and 9.

"What is my retirement plan? I keep working until I drop dead. I will have a state pension, which is a pittance," Aengus says, only half-jokingly.

Aengus and Latifa pay €1,500 per month for their house - and he estimates that up to 70pc of his income goes in rent.

Although he likes his home, he believes tenants are like second-class citizens in Ireland.

Aengus, a member of the Dublin Tenants Association, holds out for the hope that he could buy some land and move to the country.

He says rapacious landlords from real estate investment trusts (REITs) are moving into Ireland, a country with poor tenancy laws, and outbidding regular buyers.

"The traditional idea of getting a mortgage and paying it off over your lifetime has gone," he says.

"We have a lot invested in the area where we live - I work nearby and we have two kids in school.

"The problem is that tenants have no security of tenure. We can be evicted for any reason at any time.

"There should be security of tenure for all tenants so long as they are paying their rent."

He says improved security of tenure would benefit both landlords and tenants.

"Without it, tenants are not invested in a house and so are unlikely to maintain a property that they may be evicted from.

"However, when they feel secure in a house and feel that it is a home, then they are far more likely to maintain a property and engage in the community."

'The porch collapsed on my husband's head and the landlord just laughed'

Patricia Lanney (42) has seen both sides of the rental divide as both a landlord and tenant.

She rented out an apartment in Tallaght, Co Dublin and says the place was wrecked by some of the tenants.

As a tenant living in a house in neighbouring Kingswood with her husband, she herself had an unhappy experience with a landlord. After the landlord refused to pay back a €1,000 deposit, she took a case to the Residential Tenancies Board and won on appeal.

"We never had a good relationship with the landlord from the first couple of months.

"I couldn't believe how filthy it was when we moved in. The flooring was popping up in areas. There was chewing gum stuck on things.

"There were holes in the walls in the bathroom. The shower was leaking and there were holes in the ceiling.

"There was an old weather porch - and my husband closed it one day when he was going out to work and it fell on his head.

"When I rang the landlord, she just started laughing. If anything went wrong in the house and you called her, she could get quite abusive.

"After a few years we stopped calling her because of the abuse we got.

"Tenants are afraid that if they ring the landlord too much, he or she will decide to get rid of them.

"There is also the privacy issue. You are always on tenterhooks in case the landlord turns up.

"The neighbours told us that the landlord used to come around when we were on holidays and peep in the window.

"In March of last year, she gave us notice to leave, because she said she was selling the place.

"We left the place immaculate, and we thought we would have no problem getting the deposit back.

"She said we were not getting the money back."

After an appeal before the Residential Tenancies Board, she got her deposit back, plus €300 damages.

She and her husband are now living back in her family home with her father.

They are now searching for a home to buy.

"I think a lot of people are moving back to their family homes because the situation is so bad.

"There is no way that I am going to rent again after my experiences."

'I had to leave when an investor bought my flat'

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Jumping through hoops: Mark Robson's rent was hiked from €550 to €900 a month by investors. Photo: Kyran O'Brien

Like a good number of mature tenants across Ireland, Mark Robson owned his own house at one time.

But the 63-year-old lost everything in the crash of 2008, including his job as a lorry driver. "I could no longer afford my mortgage, so I had to give up my home," he says.

After working in computer security for three years in Latvia, Robson returned to Ireland and rented a two-bed apartment in Ballivor, Co Meath with the support of a Housing Assistance Payment (HAP)

"It was not fit for people to live in. There was mould and damp, which affected my health, and the roof leaked," says the widower.

Then, last year, an investor bought up the block of flats, and pushed up the rent from €550 to €900. "I was not told of the rent increase and later I was told that I was €600 in arrears."

Last October, he faced the threat of homelessness when he had to leave his flat.

"In Dublin, a landlord would not be allowed to buy a load of flats and almost double the rent.

"Landlords in Ireland are getting away with murder. There should be inspectors who check these places out."

Fortunately, Mark recently received support from the Alone charity, and has since found a flat close by, which is paid for through the HAP

'The landlord wouldn't let  me put in baby furniture'

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Leonardo with his partner Tabata and their two-month-old daughter Stella in the apartment they rent in Rathfarnham. Picture by Frank Mc Grath
 

Leonardo dos Santos and his partner Tabata had to move out of one apartment after the landlord refused to allow them to put baby furniture in one of the bedrooms for their daughter Stella.

Leonardo, who works as a software engineer, moved here last year to take up a job.

He was surprised how difficult it was to find an apartment, and attended dozens of viewings with queues stretching outside the building.

The Brazilian IT worker says in his home country, tenants have a lot more control over the property and can make it like a home, so long as they leave it in the same state as when they arrive.

"In Ireland, everything is so tightly controlled - you are like a guest overpaying to be in someone else's apartment."

The couple pay €1,900 per month for their two-bed flat - half of his net income.

Even paying an enormous rent, the couple were barred from organising one of the bedrooms for their baby in their first flat in Ireland.

He says he feels more pressure since his daughter Stella was born.

He worries about the hardships he could face if the landlord wanted to sell and he had to find another place at a higher rent.

"It's a constant cloud of fear hovering over us that if the prices keep rising, soon we won't be able to afford a place."

He has no doubt that the spiralling property prices are discouraging skilled people in his industry from coming to Ireland.

He had friends who were considered coming here, but decided against it because of the accommodation costs.

"I told them it's a great place to live, but it's rental madness.

"The prices are out of control."

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