Rosalind Carroll, Director of the Residential Tenancies Board, spoke about the RTB’s increasing responsibilities, and how to build a functional rental sector in Ireland.
The rental sector in Ireland has always been the poor relation in terms of housing. In a culture where home ownership is prized above all else, renting has traditionally been seen as a temporary stopgap on the way to ownership, and this attitude is taking a long time to change. Culture or not, however, the numbers speak for themselves and the Residential Tenancies Board (RTB) now lists almost 340,000 registered tenancies, with over 714,000 occupants and 174,000 landlords.
Rosalind Carroll took over as Director of the RTB in 2016 after a career spent in the housing sector (see panel), and says the rental sector has to be seen in the overall context of housing, where supply issues remain a major challenge: “We are starting to see signs of progress – a lot of stock being bought or built and then sold specifically for rental. That’s a really healthy sign, but restricted supply is still very much the issue”.
Changes in the rental sector
The RTB’s main functions are registering landlords and tenancies, collecting data and providing informed research and updates on the rental sector, offering a non courts-based dispute resolution service, and providing information and education to tenants and landlords on their rights and responsibilities. The RTB’s overall remit will expand quite dramatically in the not too distant future (of which more later), but for now dispute resolution remains one of its principal functions, and is a fascinating prism through which to see the issues in the rental sector. The most frequent disputes brought to the RTB relate to: rent arrears with overholding (where the tenant has been served notice to leave over rent arrears but has not left the property); notices of termination (with queries coming from both landlords and tenants); and, deposit retention. Says Rosalind: “Rent arrears are a problem for the landlord but it’s also a problem [for tenants] with regard to affordability – more people are falling into trouble in the same way it happens in the mortgage market, and it affects both parties dramatically. The limited supply of properties means more notices of termination are being referred to us because people have nowhere else to go. Before, people might not have queried the validity of the notice – although they’re absolutely entitled to do so – they might have just moved on”.
She acknowledges that regulation in the sector can be difficult for both landlords and tenants to understand, and the RTB has taken a number of steps to try to address this. Last year, they launched a new website – the one stop shop – to try to make it easier to navigate the system, and extensive advertising campaigns have sought to inform the public of their rights and responsibilities, and of the RTB’s role. A webchat facility is also available, and the organisation now also has a presence on social media. In addition, Rosalind and her colleagues monitor how they interact with tenants and landlords who contact them directly, to make the process as efficient and helpful as possible. She points out that these efforts are making a difference in practice: “60% of notices of termination that came to us [in 2017] were valid, whereas in the previous year 69% were invalid, so that shows that education is working”.
The RTB has also launched a voluntary landlord accreditation scheme, a course designed to equip landlords with everything they need to know, thus helping to prevent disputes and stop problems before they occur. It’s about professionalising a sector where 70% of landlords own only one property, and many find the regulatory regime complex and difficult: “We’re really looking forward to rolling it out to more landlords and are keen for people to sign up and to contact us if they’re interested. It’s classroom based initially but we plan to make it web based in future to expand access outside Dublin and to landlords with full-time jobs”.
The rental sector has attracted unprecedented attention in recent times, as lack of supply, growing wages, and a buoyant economy drive rents, and numbers of people experiencing homelessness reach new heights.
The rental sector has attracted unprecedented attention in recent times, as lack of supply, growing wages, and a buoyant economy drive rents up, and numbers of people experiencing homelessness reach new heights. The perception is of an entirely dysfunctional sector, where people live in constant fear of rent increases and evictions. Rosalind tries to put this into perspective: “We have 340,000 tenancies registered, and if we look at the disputes referred to us last year, they make up 1-2% of the overall registered numbers of tenants”. She accepts, however, that they are probably not seeing the full picture: “We have some anecdotal evidence that tenants are afraid to come to us. That doesn’t mean it’s happening across the board – I absolutely believe that the vast majority of landlords and tenants have a good working relationship – but there are instances where the law where the law is not being followed, and people do not know about or are too scared to come to us”.
There is clearly a need to address this and other issues, and new legislation to significantly increase the RTB’s powers, both in terms of investigation and sanction, will hopefully go a long way to achieve this. Currently, the RTB’s remit only covers the registration of new tenancies, but approximately two-thirds of tenancies at any one time are ongoing rather than new, sometimes for long periods. The new legislation proposes a move towards a system of annual registration, which will allow it to gather the data it needs on these ongoing tenancies: “Our Rent Index covers new rents, and is a reflection of the market at the moment, but it does not tell you anything about the average rent for somebody who’s already living in a property. That’s a really important statistic because most people in the sector – about 200,000 tenancies – are in existing tenancies. In order to achieve overall transparency of the rental sector we need to know more about what’s happening within tenancies”. Investigative powers will widen too: “At present the RTB does not have powers to investigate breaches of rights and responsibilities in the sector. However [under proposed changes to legislation] people will be able to come to us with information – anonymously if they wish. We will also have investigatory powers, so it’s not necessarily left to the most vulnerable to [come to us]”.
The proposal to introduce a sanctions regime will see the RTB’s role evolve, becoming a more proactive regulatory body: “It’s about proportionality. It’s a criminal offence not to register with the RTB – we will work with landlords to help them comply but if they don’t it goes straight to criminal conviction. We are trying to move to having a civil stage in between – a sanctions regime that would allow us to give them a caution and a warning for not registering a tenancy and for illegal rent increases. Where there’s no engagement, or [a landlord has] knowingly committed that contravention on a large scale, we can then pursue these landlords with fines of up to €20,000”.
She acknowledges that these are potentially big changes, but thinks they’re needed: “I think it will benefit both landlords and tenants. Many landlords are frustrated with their negative media profile and we’ll be able to go after the small number of bad landlords and show the good as well”.
Legislation is currently going through the Oireachtas, and at time of writing it has not been finalised, but Rosalind hopes it will be in place by the end of this year, followed by an implementation phase that would see the new RTB powers up and running during 2019.
Of course, another way to solve these problems is to make the regulatory system a little less complicated, and that’s something Rosalind and her colleagues are very conscious of. In fact the RTB’s Strategic Plan 2018-2022 gives as an aim: “Continue to advocate for a simplified and streamlined Residential Tenancies Act”. Rosalind acknowledges that what’s probably needed is a new Act, but while the Minister has given a commitment to reform, it’s a big undertaking, and unlikely to happen any time soon. The priority has to be the current crisis.
Getting the data
The RTB has an important role in the collection of data on the sector, and has already contributed significantly: “Before the RTB we didn’t even know how many tenancies there were. The Rent Index has also been hugely important in terms of being able to put out authoritative, official data on rent levels that’s robust, and can be relied upon. We want the RTB to be the official source, because it is directly feeding into policy”.
Annual registration will enable them to add considerably to this store of information, and there are other projects in the pipeline too, including annual surveys of all stakeholders, and a project to analyse the impact of Rent Pressure Zones on the sector.
The future of renting in Ireland
The current issues are, obviously, very significant, but Rosalind and her colleagues also have to think in terms of what the sector could be, and work towards that. Diversity is key, both in terms of landlord and tenant type: “We need to think about the fact that some tenants will stay short term, some will be longer term. We will need more not-for-profit landlords offering more affordable rental accommodation that isn’t social housing. That will have a stabilising effect. I think we absolutely need more institutional investment, more professional landlords. I would also like to see some of our smaller landlords grow”.
In to be delivered, such a vision would need to be complemented by significant policy changes: “As we increase security of tenure we also have to increase security of income for landlords. We need to think about what structures will incentivise the types of landlords that we want and that are going to lead a stable, sustainable sector.
Rosalind is optimistic about the future, if we can change attitudes, and provide the regulatory structure to back it up: “We can make renting good for landlords and tenants. But I also think culturally we need to think about renters differently. When we think about communities, do we think about the renters in those communities? It’s not just about landlords, it’s about us as a society”.
Rosalind Carroll has worked in housing for 18 years and says that it’s very much a career of choice: “Housing is one of my passions”. She worked in Dublin City Council and in the Department of the Environment, Community and Local Government before moving to the Housing Agency, where she was Head of Regulation of Approved Housing Bodies before moving to the RTB. Outside of her busy schedule, she spends her free time catching up with friends and family, and returning play dates with her six-year old daughter.
Managing Editor, Think Media