The possible abolition of rent pressure zones (RPZs) at the end of 2025 has been signalled by Taoiseach Micheál Martin as part of a significant shift towards more private investment in the housing sector.
In an indication of a major pivot in policy Mr Martin said on Sunday the Government would explore an alternative to RPZs between now and the end of the year when they are due to expire.
“We’ve got time because the rent pressure zones expire at the end of the year,” he said. “We have time to see if we can develop an alternative system which protects renters but also (allows for) a clear, stable environment in which to invest,” Mr Martin told the This Week programme on RTÉ.
RPZs were introduced in Ireland in late 2016, and have been designed to cap rent increases in areas where there is high demand for housing and for rental homes.
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They were originally introduced in Dublin and Cork but now apply to urban areas in 17 of the 26 counties. Where an area has been designated a RPZ, rent increases cannot be greater than the rate of inflation or 2 per cent, whichever is the lower. New areas have been designated as RPZs as recently as December 2024, when Sligo-Drumcliffe was added, bringing to 65 the total number of RPZs in the State.
Asked whether those changes might lead to rent increases, Mr Martin said a stable environment for investment was needed that “won’t start changing from year to year for political reasons”.
He said the process would not be a crude change from RPZ but a review of housing policy focusing on how to incentivise the private sector. The private rental sector was deteriorating, he claimed.
He said it was clear to him the State would need to “pivot more strongly to getting private sector investment into the market”.
“The Government is spending huge amounts of money in housing, record levels of spending. The State can’t do it all on its own, and we have to be honest about that. I believe it will entail politically very difficult decisions.”
Sinn Féin housing spokesman Eoin Ó Broin said the Taoiseach was “succumbing to a very aggressive industry lobby in train for a number of weeks which wants an end to rent regulations. “Rent is at historic highs and will increase further,” he said.
He added that the two big deficits in housing provision were making access to lower interest finance available to SME investors and dealing with delays in planning, partly caused by understaffing in local authorities and in the planning board.
Rory Hearne of the Social Democrats said: “The Taoiseach’s ‘big move’ on housing is ramping up support for vulture funds. We need affordable homes that people can buy and rent, not more unaffordable ‘build to rent’ apartment blocks.”
Conor Sheehan of Labour said that RPZs had failed as a policy but flagging their abolition on national radio without introducing a rent freeze was “extremely worrying”.
“Rents have gone up by 40 per cent over the term of the previous government and are increasing by 10 per cent year-on-year even with RPZs. We need a radical reset of housing policy, including at least a three-year rent freeze and not a Taoiseach making housing policy on the hoof on national radio,” he said.
In the RTÉ interview Mr Martin also confirmed there would be no cost-of-living package in next October’s Budget as there have been in the last three budgets. Inflation had fallen significantly, he said, adding that changes in social protection and tax structures would help people but there would be no energy credits this winter.
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