New rent rules will help – but not those who have no home

One of the worst things a government can be accused of doing in the midst of a crisis is nothing – particularly when an election is looming.

It is possibly best to view the raft of proposals published this week aimed at dealing with a chronic housing and homelessness crisis in such a context.

After much hand-wringing and wrangling across Government departments, Minister for the Environment Alan Kelly and his counterpart in Finance, Michael Noonan, have finally published details of legislative proposals aimed at tackling the problem which will now be fast-tracked into law.

The Government needed to act, so it has acted, but will it make a difference?

The jury is still out.

Supply shortage

The single greatest cause of the housing problem in the Republic is supply. There are just not enough homes for all the people who need them, and the State has failed many citizens by not ensuring a steady stream of social housing in recent times.

While the new package has some measures aimed at incentivising housebuilding, such measures will not come fast enough for many thousands of people – nor will they make a difference to the outcome of the spring election. The element of the legislation that has so far received most attention has been a plan to freeze residential rents for periods of two years. This is understandable as it will be of immediate benefit to many tenants who will be spared rent increases until 2017 – as long as they don’t move to alternative accommodation.

However, it is probably not the measure with the most potential to make an impact on the housing shortage in the short term.

Mortgage relief

As well as a two-year rent review period, landlords who house social tenants will be given 100 per cent mortgage interest relief compared to the 75 per cent mortgage interest relief they will otherwise be allowed.

This carrot rather than stick approach could save the owners of modest properties in Dublin city more than €1,000 a year and should convince some of them of the wisdom of opening up their homes to social tenants.

The package will also take on landlords who attempt to evict tenants by claiming that they are selling properties before recruiting new residents at a higher rent. They will face fines of up to €3,000 it if subsequently emerges that they did not sell.

The requirement for landlords to give 28 days’ notice of a rent increase will also make a difference, although it is a difference that will only be felt by those currently in homes and will do nothing for the people still cast adrift.