The Irish rental market is pressured from undercapacity, overdemand and well-intentioned but debatably ill-judged regulation. However, Dublin and Ireland are hardly unique, and several other European cities have similar challenges.
In Denmark, the US private equity group Blackstone purchased tens of thousands of apartments andoffered financial inducements to prematurely sever leases. In response, in July 2020 the national government passed its so-called “Blackstone Law” to freeze rents for five years after a property purchase, prohibit incentives to terminate early, and require energy efficient upgrades before any rent increase.
The German housing shortage is at its highest level for decades due to surging construction costs, rising interest rates and an influx of refugees particularly from the war in Ukraine. Rents in Berlin have more than doubled in a decade. With half the population living on rent, in September 2021, Berliners voted in favour of a non-binding referendum to expropriate more than 240,000 housing units from large property investment companies to the state government.
In May 2023, the Spanish government intervened in the national rental market for the first time in its recent history. A rent cap of 3 per cent was set for 2024. All professional and agency fees, when a rental contract is put in place, are to be met solely by the landlord and not the tenant. Local governments can apply additional measures in rental stress zones, defined as areas where housing costs are more than 30 per cent of average household income.
The Irish Residential Tenancies Board (RTB) was established in 2004, originally to regulate the private rentals sector. Its remit was later extended to cover both approved housing bodies and student accommodation. It maintains an online searchable register of tenancies (by Eircode), and resolves disputes between tenants and landlords. Since April of last year, landlords are required to register each tenancy with the RTB annually on the anniversary of its start date. The results of RTB dispute determinations are also published online, organised by dispute category.
Last month, the RTB 2023 annual report showed nationwide 223,979 registered tenancies, a drop of 9 per cent from the prior year.
Can technology innovate in the rental sector? In the same way that fintech is an umbrella term for technologies applied to financial services, so proptech applies to the property sector and more specifically renttech applies to the rental sector.
Proptech applications include construction planning and project management, conveyancing support, property marketplaces and listings, investment and financing structures, and smart home technologies.
Property management solutions cross the boundary between proptech and renttech. As but one example, Ambisense offers a monitoring sensor that detects damp and mould (disclosure: I was a board observer until last December). Using historical data accumulated from its sensors, Ambisense has also trained a machine-learning algorithm that can predict the likelihood of a mould outbreak in a given property, thus warning both tenants and landlords in advance.
But for tenants, and indeed for many landlords, the probable top priority in renttech is full transparency on what properties are available for rent in a specific locality, their rental status and history, and comparisons to nearby rentals.
The novel free site howmuchrent.com takes records published by the RTB and rental listings, and combines the data as a zoomable map of Ireland, right down to individual streets. Each marketed rental property is marked as to whether or not it is registered with the RTB, its advertised rent level, and if it is shared with other tenants. Previous tenants can post their reviews of particular properties, highlighting attractions and any issues.
Properties that have had disputes resolved and then published via the RTB are tagged, including the identities of the landlords and tenants involved in each case. Specific properties having a history of an unusually high level of disputes are also flagged.
Much of the country is designated as a rent pressure zone, in which rents cannot rise by more than 2 per cent each year. Furthermore, if a tenancy concludes, the rent applying to a new lease must conform with the previous rent, even if the ownership of the property has changed. Using howmuchrent.com, it is possible to examine right down to the street level individual properties that appear to be breaking this rule, based on their historical and currently advertised rents.
The site was built as a service to the public and without investment by Vinny Glennon, an experienced software developer, one-time chief technology officer of the Web Summit, and part of the team that built Ireland’s first online property auction site. In discussing the initiative with him, he noted that just before Covid his landlady had terminated a lease with him because a family member was ostensibly about to move in, but three weeks later he found the property back on the market with a 30 per cent rent rise.
He told me: “Everyone has a story, good and bad, about a place they rented, but these stories vanish once that tenant leaves. It’s time for a fairer rental market. Would you buy a used car without checking its history?”
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