Varadkar defends a landlord accused of ‘gouging tenants’
Property fund got €8m off State but hiked rents by more than cap
TAOISEACH Leo Varadkar has jumped to the defence of a State-backed landlord who is hiking rents above the caps brought in to protect tenants.
While opposition TDs described a 6pc price increase inside a so-called ‘rent pressure zone’ as “morally repugnant” and “gouging”, Mr Varadkar said the DAD Property Fund acted appropriately.
Under rules brought in by this Government, landlords can only increase rents in pressure zones by a maximum of 4pc annually.
But an exemption has allowed rents on a number of apartments in south Dublin, funded to the tune of €8m by the State’s investment fund, to be hiked by 6pc.
The law says a property new to the rental market, which has not been let out in the two years before its location was made a rent pressure zone, can be exempt from the cap.
Details of the hikes by the landlord of the New Bancroft Centre in Tallaght were re- vealed by the Irish Independent yesterday and led to widespread calls for legislative change.
Fianna Fáil’s finance spokesman Michael McGrath said: “This is a blatant attempt by the landlord to violate the spirit of the legislation and to heap even more pressure on hard-pressed tenants.”
However, Mr Varadkar said it was in the public interest to retain the special exemption and that any move to decrease housing supply would be “counterproductive”.
“Fundamentally it [DAD Property] is making available for rent apartments and houses that are not at the moment available for rent, so it is providing properties that people desperately need. And as a result of that helping to increase supply and reduce pressure on rising rents,” Mr Varadkar said.
When asked if the legislation was flawed and needed to be reviewed, Mr Varadkar said that the exemption for new builds was added for a “good reason” – to boost housing supply.
“We actually need more homes and more apartments to be made available for rent so when the Oireachtas put that exception in, it put it in for a reason, which is to encourage more builders to build properties that can be rented and to encourage more people who have homes or apartments that could be put in the rental market to do so,” he said.
DAD Property also breached the law by carrying out rent reviews when tenants were less than one year in their apartments. The fund admitted that it moved too early, saying it believed increases could be signalled 90 days before the one-year anniversary.
A spokesperson for DAD Property Fund confirmed that representatives met yesterday with the ISIF fund to discuss the issues raised and “acknowledged the gravity of matters raised, expressed regret for the error in relation to the timing of renewal notices, and reiterated our commitment to adhere to all the appropriate regulations”.
It added: “We communicated with all tenants who had received incorrect renewal notices and apologised for the error.”
However, political reaction to the story has been damning, with Mr McGrath saying it is “not acceptable that landlords backed by the State-owned Ireland Strategic Investment Fund (ISIF) are flagrantly using” special exemptions. “The idea that a landlord in receipt of €8m in State investment would not adhere to the 4pc rule cannot be overlooked by ISIF or the Finance Minister.”
Mr McGrath said the ISIF can have a “very positive social impact”.
“However, in this case, the public good is not served by State funding enabling landlords to rip off tenants.”
The Labour Party’s housing spokesperson Jan O’Sullivan said the exemption meant landlords “can price gouge for the first two years they are renting in pressure zones”.
Social Democrats co-leader Catherine Murphy said: “The Housing Minister needs to send a clear signal to corporate landlords that this kind of behaviour is morally repugnant, particularly at a time of chronic housing shortages and when many tenants are already pinned to their collars paying monthly rents.”
LEO Varadkar and Italian Prime Minister Giuseppe Conte have failed to reach a deal that would see Ireland take in 600 migrants.
Mr Varadkar met the newly elected prime minister in Rome as the pair discussed the issue of migration.
Both leaders agreed it was a “European issue” and every country in the bloc must play a part in tackling it.
The offer, extended to the previous Italian government in 2015, was put on the table again at the meeting by the Taoiseach but no deal was reached on how to tackle the issues of security clearance and Garda vetting of those relocating to Ireland.
“I restated our commitment or offer which we made to the previous Italian government that we would be willing to take 600 migrants from Italy to Ireland.
“It wasn’t possible to do that even though we committed to it probably two years ago now, because we couldn’t agree the detail around Garda vetting and security clearance,” Mr Varadkar said.
Ireland has demanded more involvement on the Italian side in vetting those due to move to Ireland.
Mr Varadkar said the offer was still on the table “if we can agree on appropriate security clearance and we said we would engage further on that”.
Italy’s stance on migration has hardened of late. It has acted as a frontline nation in the crisis and taken the brunt of the burden.
Now it wants other countries to do their part.
Challenges
Mr Conte has previously called for Europe to abandon the principles of the so-called Dublin agreement that sees member states where the immigrants first arrive held responsible for their processing.
Both leaders agreed on a Europe-wide approach to the issue of migration, during what was described as a “constructive” meeting.
“Any individual country acting on its own just passed the challenges on to the next country and we are very much of the view that we must have an EU-wide approach,” Mr Varadkar said.
Speaking after the meeting, the Taoiseach said he believed there was a good basis for a good relationship between the countries in the future.
Mr Varadkar also visited the headquarters of Operation Sofia, the EU’s rescue mission in the Mediterranean in which the Irish Naval Service takes part.
At the conclusion of his whistle-stop tour of EU capitals, Mr Varadkar also said he had received assurances in each that the Irish question remains a central issue of Brexit.
He said: “My sense is they very much have Ireland’s back, very much understand our concerns and are very much on our side but also looking to us for solutions – that’s what we need to do over the weeks ahead – to know that we have a strong European solidarity behind us, that the 27 member states are with us but also work to come up with solutions that everyone can live with.”