Co-living residents may fall outside rental protections

Residents in co-living developments could face year-on-year rent increases and be exempt from other rental protections depending on the agreement they sign with landlords, it has emerged.

The Department of Housing has said individuals living in this new type of development could be issued licences instead of leases, which would not be covered by the Residential Tenancies Act. The Act enforces a 4 per cent rent cap in rent pressure zones and allows residents to bring disputes to the Residential Tenancies Board (RTB).

But legal experts and tenants’ rights groups have said it is “highly likely” residents in these developments – who will have individual en-suite bedrooms but shared kitchen and living areas – will be issued licences instead of leases as co-living is similar to student accommodation, which operates on a licensing agreement.

The Department of Housing said when the owner of a dwelling enters into an agreement with a person, it is a “private contractual matter” as to whether that agreement is a licence or a tenancy.

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“Where a dwelling is occupied by a person under a tenancy to which the Act does not apply or under an arrangement or agreement which is not a tenancy, such as instances where a bona-fide licensing arrangement exists, the RTB does not have any function,” a spokesman for the department said.

Minister for Housing Eoghan Murphy has repeatedly defended the co-living policy against Opposition criticism, including when he last month compared co-living spaces to a “very trendy, kind of boutique hotel type place”. However, he later said this comparison was not a “good one”.

The RTB said each co-living arrangement would need to be examined “on a case-by-case basis” to determine if they are covered by the provisions of the act.

“Each case would need to be measured on its own merit to determine if a tenancy exists as defined by the Act,” a spokeswoman said. The RTB added that just because something is labelled as a licence does not mean it is one, and encouraged anyone who is unsure of their rights to contact them.

Mere permission

Aoife Beirne, a barrister practising in the area of landlord and tenant law, said a licence was a “mere permission” to be on the property of another.

“The most important characteristic of a lease as opposed to a licence is the concept of exclusive possession. This means that the tenant has the exclusive right to possess the property, to the exclusion of all others, including the landlord,” she said.

“Clearly, the requirement for exclusive possession raises some questions regarding whether or not occupants of co-living properties are parties to leases or licences, and an amendment to the residential tenancies legislation may well be required,” she added.

Since August 15th, purpose-built student accommodation has been brought under the provisions of the Act. However, the department said the amendment that enables this applies to “student-specific” accommodation only.

Darragh O’Brien, Fianna Fáil’s housing spokesman, said the position on co-living “contradicts” the idea behind the changes to the law.

"If they are saying that, they should be saying it to the Oireachtas committee, respectfully," Mr O'Brien said. "Secondly, it contradicts the position of other licences to reside, or other licence arrangements."

Last month, permission for the first co-living development was approved for Dún Laoghaire town centre by An Bord Pleanála.

The development, proposed by Bartra Capital, will see the construction of 208 units and includes a provision for communal kitchen facilities, which would be shared by up to 42 residents.

Mike Flannery, chief executive of Bartra Capital, said at the time that the approval was "a pragmatic decision based on Ireland's need to embrace new tenure types".

In a separate planning proposal currently before Dublin City Council, developers are attempting to reduce the minimum size rooms in a co-living development to 6sq m-9sq m.The current minimum is 12sq m.