Regulation of the Private Rented Sector: Where Do We Go From Here?

Eoin O’SullivanTrinity College Dublin

Proposals are firmly geared towards increasing supply, via restoring and enhancing the tax treatment of Landlords in the PRS.

Increasing knowledge of the sector and professionalizing the sector are deemed crucial.

Further regulation in terms of rent certainly or security of tenure deemed to be ‘risky’ and could ‘jeopardize’ the sector.

Perversity thesis – the action undertaken in its name is ill-conceived; indeed, they will most typically argue that this action will produce, via a series of unintended consequences, the exact contrary of the objective that is being pursued.

While the thesis of the perverse effect proclaims that the alleged progress will in fact lead to regress, the futility thesis asserts, to the contrary, that the attempt at change is abortive, that in one way or another any change is or was largely surface, facade, cosmetic.

The Jeopardy thesis asserts that to move in a certain direction, though feasible and even desirable if viewed in isolation, carries with it unacceptable costs of one sort or another.

Secure Occupancy• Access affordability • Ongoing affordability • Security of tenure • Terms of tenancy • Conditions of tenancy • Redress• Housing assistance • Tenancy support and tenancy sustainment

programs • Ontological security

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1,551 1,548 1,592 1,598 1,633 1,648 1,709 1,868 1,960 1,975 2,059 2,107

926 837 917 941 941 9321,011

9901,020 995

1,022 1,036

Homelessness (Section 10 funded Emergency Services) April 2014-April

2015

Dublin Outside Dublin

16-22

June

2014

14-20

July 2

014

18-24

August

2014

21-27

Sept

2014

20-26

Oct 201

4

17-23

Nov 20

14

22-28

December

2014

19-25

Janua

ry 201

5

16-22

Febru

ary 20

15

23-29

March 2

015

20 - 2

6 Apri

l 201

50

500

1000

1500

2000

2500

3000

3500

Household Composition

Couples with Dependent Children Individuals with Dependent Children Adult Individuals (No Children)

16-22

June

2014

14-20

July 2

014

18-24

August

2014

21-27

Sept

2014

20-26

Oct 201

4

17-23

Nov 20

14

22-28

December

2014

19-25

Janua

ry 201

5

16-22

Febru

ary 20

15

23-29

March 2

015

20 - 2

6 Apri

l 201

50

200

400

600

800

1000

1200

Child Dependents of Homeless Households

Dublin Outside of Dublin

7-13 A

pril 2

014

16-22

June

2014

14-20

July 2

014

18-24

August

2014

21-27

Sept

2014

20-26

Oct 20

14

17-23

Nov 20

14

22-28

December

2014

19-25

Janua

ry 20

15

16-22

Febru

ary 20

15

18-24

23-29

March 2

015

20 - 2

6 Apri

l 2015

0

500

1000

1500

2000

2500

Age Profile

18-2425-4445-6465+

Quarte

rly 1

Total

Perso

ns (LA

)

Quarte

rly 2

Total

Perso

ns (LA

)

Quarte

rly 3

Total P

ersons

(LA)

Quarte

rly 4

Total

Perso

ns (LA

)

Quarte

rly 1

Total

Perso

ns (AH

B)

Quarte

rly 2

Total

Perso

ns (AH

B)

Quarte

rly 3

Total

Perso

ns (AH

B)

Quarte

rly 4

Total

Perso

ns (AHB)

Quarte

rly 1

Total

Perso

ns (Pr

ivate)

Quarte

rly 2

Total P

ersons

(Priv

ate)

Quarte

rly 3

Total

Perso

ns (Pr

ivate)

Quarte

rly 4

Total

Perso

ns (Pr

ivate)

0

50

100

150

200

250

300

350

400

Exits to Tenancies by Quarter

de Boer, R. and R. Bitetti (2014), “A Revival of the Private Rental Sector of the Housing Market?: Lessons from Germany, Finland, the Czech Republic and the Netherlands”, OECD Economics Department

Working Papers, No. 1170.

• Adequate tenancy security has positive consequences for the housing market

• For both investors and tenants a high security of tenure creates a stable and long-term demand for rental dwellings and investors profit from stable incomes.

• Substantially reducing tenancy security affects long-term demand.

• Unbalanced tenancy protection and inefficient eviction procedures hamper PRS.

• Both ‘over-regulation’ and ‘under-regulation’ of rent setting can lead to a marginal PRS.

Next Steps• New Legislative Framework

o Eliminate existing difficulties o Integrated framework for providing secure occupancy

• Enhanced role for the RTB

• Private Renting and Public Policy