Minister says rent controls reducing increases in cost

Rent controls are working in reducing increases in rental costs in Dublin, according to Minister for Housing Eoghan Murphy.

Mr Murphy was addressing a meeting of Dublin City Council to brief councillors on the progress of Rebuilding Ireland - writes

The Minister said that rent in Dublin will rise by an average of just 3% this year after its designation as a Rent Pressure Zone, if the trend from the first two quarter continues.

He said this compares with increases averaging 8.5% last year.

Mr Murphy also told the meeting his department is working on a more precise definition of "substantial refurbishments" which landlords can claim as grounds for rent increases.

It follows complaints that this clause is being abused by some landlords.

The Minister also said research has shown that the actual amount of vacant homes is below 20,000, with many of the 190,000 units reported by the CSO found to have been between lettings or up for sale.

However he said the construction industry is building more, with commencement notices for new builds up by between 38% and 42% in Dublin.

He told the monthly meeting of city councillors that there will be nearly 8,000 new social housing units next year with 3,800 of these new builds by local authorities and housing bodies.

However the chair of the council's housing committee, Councillor Daithi Doolan (Sinn Féin), said the department is sleepwalking through the biggest housing crisis in the State's history.

He said only 12% of Dublin City Council's new social housing up to December 2018 will be new builds while 56% will be private rental units through the HAP scheme.

Cllr Doolan said the two main reasons for the lack of new builds is a cut in funding compared to 2010 and bureaucracy in the Department of Housing.

Many councillors also complained that available land is not being used for social housing developments.

Councillor Michael O'Brien (Solidarity) said the city council itself owned enough land for 10,500 housing units.

He added that there were demands for more affordable housing schemes.

Meanwhile, the Government is likely to announce measures in the coming days aimed at making new apartments more affordable.

They are likely to focus on changing planning rules in cities to allow for the building of higher apartment blocks.

They could also ease the requirement that each apartment should have one car parking space in a bid to reduce building costs.

This change will be allowed in areas that are well served by public transport.

Builders estimate that the cost of underground parking adds up to €100,000 to the construction cost of an apartment.

Earlier, MinisterMurphy said the forthcoming budget will include additional resources for social housing, as well as affordability measures for buyers and renters.

Speaking at the tenth anniversary of Simon Week this morning, Mr Murphy said one in five houses built next year will be social housing.

He also acknowledged that the repair and leasing scheme "hasn't worked" and says changes to it will be announced in the budget.

The social housing budget has fallen from €1.54 billion in 2008 to €680 million this year.

Latest figures show that there are now over 8,000 people living in emergency accommodation.

The Simon Community says increasing supply in the private sector will not bring down prices in the short-term.

Elsewhere, the chief economist with Goodbody, Dermot O'Leary, has said he believes the official numbers of new house builds are being significantly overstated .

Meanwhile, a report for by Davy's chief economist, Conall MacCoille , has said that the acceleration in asking prices for houses which began in late 2016 has continued through 2017 and is likely to continue during 2018.

Read more Irirsh news on our city guide of Dublin.

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