Housing Commission recommends ‘reference rent’ reform

Housing Commission Recommends ‘Reference Rent’ Reform
Housing Minister Darragh O’Brien published the long-awaited recommendation on Wednesday evening.
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By Cillian Sherlock, PA

Rent pressure zones should be replaced with a system that ties rates to local buildings of a similar quality, according to a landmark report.

The reform is one of dozens contained in a major examination of Irish housing policy.


In its report, the Housing Commission said that housing must be a “unique national priority” with the purpose of supporting social cohesion and economic development.

Outlining 83 recommendations, the Commission said that Ireland has an opportunity to change policy to improve the lives of citizens.

It said it had a “major concern” with Ireland’s housing deficit and urged emergency action coupled with a “step-change” increase in supply.

The Commission said there should be a targeted increase in the proportion of social and cost-rental housing to 20% of the national stock, ensuring an appropriate tenure mix.


It identified core issues of “ineffective decision making and reactive policy making where risk aversion dominates”.

It added: These issues, together with external influences impacting housing dynamics, contribute to volatility in supply, undermining affordability in the housing system.

“Should these issues persist, there will continue to be insufficient progress on the issues our society faces.

“These problems have arisen due to the failure to successfully treat housing as a critical social and economic priority, evident in a lack of consistency in housing policy.


“Inconsistency undermines confidence. A consequence of these policy failures is that Ireland has, by comparison with our European partners, one of the highest levels of public expenditure for housing, yet one of the poorest outcomes.”

Housing Minister Darragh O’Brien published the long-awaited recommendation on Wednesday evening.

Among the key recommendations are implementing specific measures to end child homelessness, recognising the requirement for “emergency action” to address the housing deficit, and ensuring that policy encourages integrated and inclusive communities.

The Commission said the Government should regulate market rents fairly and effectively by reforming current regulations and establishing “reference rents”.


This would change Rent Pressure Zones, where maximum market rent increases are tied to either a cap of two per cent or inflation, with a system that pegs rent to local dwellings of a similar quality.

It also recommended establishing an oversight executive for housing delivery and high-yield zones at strategic sites.

It called on the Government to support the development of “standard” house and apartment types to drive efficiency, and to carry out a national housing condition survey every five years.

The Commission also recommended resetting the Housing Assistance Payment and Rental Accommodation Scheme as short-to-medium term support measures.


In addition, it wanted the Department of Housing to provide a sustainable financing model for social housing by setting social housing rents at cost recovery rates.

It also requested that the measures would be taken to improve capacity of the Approved Housing Body sector.

The Department said the Commission’s proposals will inform the upcoming Housing for All Action Plan Update as well as revised targets due to be published in the autumn.

Among the next steps will be the publication of ESRI research and modelling on population projections and long-term housing demand as well as the establishment of an inter-departmental group to consider the proposals.

Ultimately, Mr O’Brien will bring policy proposals to the Government on a potential referendum on housing, which the Commission was also tasked with considering.

It suggested wording for a constitutional amendment which includes an explicit recognition by the State of the fundamental importance of having a home to both individuals and society, as well as a specific guarantee for access to housing.

In a statement, Mr O’Brien said not everything in the reports released “is accepted or agreed”, adding that a full analysis will be required before actions are taken.

However, he said: “Having said that, 65 of the 83 actions, or 78% of the recommendations are already implemented, under way or partially underway.”

A minority report from the commission was also published and cast doubt on the necessity of an amendment as the authors found there was no “constitutional barrier” for the Government to take steps to address the housing crisis.

It found that the proposal to hold a referendum to correct perceptions or demonstrate a commitment to the housing crisis is “misguided and unjustifiable”.

If there must be a referendum, the minority report authors argue that it should provide for an obligation on the State to draw up along-term plan on housing and to implement that plan progressively.

The minority report was signed by Ronan Lyons and Michael O’Flynn.

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