Bacon report offers little comfort for tenants

Being a landlord of a Section 23 property may have lost some of its attraction as a result of the Bacon report recommendation that tax relief on investment properties purchased after April 23rd be abolished. But that report is not making a tenant's life any easier either.

Many rental agents are predicting that with the tax incentive gone, the stock of rented accommodation especially city-based apartments is going to thin out and rents will go up. Even before the Bacon report, it was something that Ms E and her partner, who share an apartment on Dublin's quays were already worrying about.

"My rent is currently £400 a month for a one-bedroom apartment. A similar apartment in the building was advertised in the paper for £550 per month and on the noticeboard the other day another was going for £475. Last year, our apartment was flooded twice and while the landlady let us away with two months' rent, we were never given a satisfactory explanation for the flood and went three months without carpets and wallpaper in the living room."

Ms E was never compensated for the damage to her possessions and is now worried that her rent may be increased to £550 or more when it comes up for renewal.

"Does a tenant have any rights regarding rent increases year on year? It is often written that Dublin is becoming more like Europe where people rent all their lives, but they don't mention that on the Continent the tenant is king. Had the sort of flooding we experienced happened in Italy or Germany there would have been hell to pay."

Threshold, the organisation which represents people who have difficulties obtaining or holding onto their rented accommodation, agrees that compared to other countries where the rented sector is more vigorous, tenants in Ireland have fewer rights. In its last annual report, it estimated that there was a need for another 250,000 homes over the next 10 years. And while there has been a big increase in flats at the top end of the rental market, there is a serious shortage in the middle and bottom price range.

Landlords in the State, Threshold says, are required to register their properties with the authorities, but of the estimated 80,000 rented dwellings, only 19,384 are registered; a third of the 6,000 inspected in 1996 failed to meet regulations and there were nearly 5,000 cases of landlords not providing rent books.

Threshold assists tenants with issues like notices to quit, evictions, rent practices, problems between tenants and landlords, and does not restrict itself to lower income tenants. Tenants may not have many rights here, but they are entitled to a few, such as: [SBX]

28 days notice to quit, in writing;

a rent book which includes the address of the property, name and address of the landlord and tenant, the period of the tenancy, the amount of rent and any other particulars and when it is to be paid; the amount and purpose of any deposit; a statement of the tenant's basic rights; the date the tenancy started; an inventory of furnishings provided by the landlord;

that standards set out in the Housing Regulations 1993 Act be complied with;

that the accommodation be registered with the local authority.

There is no independent rental board in this State which can arbitrate disputes between tenants and landlords, especially over the matter of rent increases. There are no rent controls and unless you have a written lease, the landlord can raise the rent by whatever amount, whenever he wishes. There are a small number of controlled tenancies in place which were subject to rent control up to 1982. These tenants have been awarded life tenancies for themselves and their spouses and have access to a rent tribunal.

With the price of housing escalating, and now out of the reach of an increasing number of younger Dublin home buyers, the time has come, as our reader suggests, for all parties Government, the private sector and consumers to look seriously at how other countries accommodate their rented sector.

If more people are to rent houses, flats and apartments, there needs to a larger stock of housing units for rent rather than purchase and that may require tax reliefs for landlords or developers who specifically build and maintain private rental units. Rented units need to be more spacious to accommodate families as well as individuals or couples. They will need to provide adequate storage facilities and utilities like laundry rooms and garages and some provision needs to be made, not for rent control, but for a standard by which an increase in the rent can be justified.

Disputes could then be handled by independent rent boards that work informally, not unlike the Small Claims Court system already in operation.

An increase in the rented housing stock, an opportunity for longer term leases, provisions to sub-let for long-term tenants and an official body to which a landlord or tenant could argue a case, should have the effect of stabilising and perhaps even bringing down rents proportionate to the cost of mortgages. preferably as young as possible There have been sound financial reasons for property ownership: prices were low and subsidies were high. But this also had the effect of tying down the labour force, artificially inflating the price of new homes and more recently, of fuelling house price inflation.

With prices so high, especially in Dublin, home ownership is rapidly becoming something to aspire to in your 40s rather than in your 20s. That need not be such a bad thing since it also offers a personal freedom that so many young people here have been forced to abandon by becoming home owners so early.