"One person's rent is another person's income" – Varadkar rejects calls for three-year rent freeze 3 weeks ago

"One person's rent is another person's income" – Varadkar rejects calls for three-year rent freeze

The Tánaiste was grilled over concerns that renters could be facing increases.

Tánaiste Leo Varadkar has rejected calls from Sinn Féin spokesperson for Housing, Local Government and Heritage Eoin Ó Broin to introduce a ban on rent increases for three years.

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Speaking during Leaders' Questions in Dáil Éireann on Tuesday (21 September), Varadkar said a "balance" was needed between the regulation of property rental costs and income for landlords.

Ó Broin grilled the Tánaiste over the Government's decision earlier in the year to link a rise in rents in rent-pressure zones (RPZs) to increases in inflation.

While renters were promised the change would lead to lower rent increases, the inflation rate used to determine rents in RPZs has since risen by 3%, according to a report in the Irish Independent.

Ó Broin said: "Rising rents and falling supply – that is the Fine Gael way," adding that the decision to link rents to inflation was "too little, too late".

"Inflation is running at 3% and economists are saying it will rise even further," he added.

Addressing Varadkar, Ó Broin asked: "Will you urgently introduce a ban on rent increases for three years?"

However, the Tánaiste shot down the call by defending the recent change.

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"Among the reforms that we've made to help people who are renting is the introduction of a rent freeze in real terms," he responded.

"That means that rents can only increase by the rate of inflation or less as measured by the Harmonised Index of Consumer Prices.

"The logic behind that is, first of all, to protect renters to make sure that rents don't rise quicker than prices in general and don't rise quicker than incomes and that's important."

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Varadkar added that in doing so, a "balance" had to be struck.

"The number of rental properties available in Ireland is falling," he said.

"Landlords are leaving the rental market – and bear in mind most landlords, and I'm not one of them, only owns one property or two. 86% only own one property or two.

"So, we need to balance that, too. One person's rent is another person's income. It might be their pension, it might be how they pay the mortgage.

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"In a time of rising prices and in a time of rising interest rates... if you freeze rents absolutely to zero, that could mean an income cut for another person, a pension cut for another person or another person unable to pay the mortgage on their property... causing more landlords to leave and fewer rental properties on the market."

Varadkar stated "the only solution" to bring down rents is more supply.

In response, Ó Broin said: "The more I hear you talk about housing, the more I realise you actually don't understand it.

"You said you've introduced a rent freeze in real terms. In fact, when the legislation was introduced inflation was at 1.9%.

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"Today, in the Irish Independent, economists are quoted as saying it is likely to pass 4%. A rent freeze means no rent increases. Not 2, 3, 4 or 5%."