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Ireland modifies rent controls as it seeks to revive homebuilding
Published by Global Banking & Finance Review®
Posted on June 10, 2025
2 min readLast updated: January 23, 2026
Global Banking & Finance Review®
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Published by Global Banking & Finance Review®
Posted on June 10, 2025
2 min readLast updated: January 23, 2026
Ireland modifies rent controls to balance tenant protection and encourage homebuilding, aiming for 50,000 new homes annually by 2030.
DUBLIN (Reuters) -Ireland made minor changes on Tuesday to rent controls, seeking to strike a balance between what the housing minister described as a "doubling down" on protecting tenants from some of Europe's highest rental costs and encouraging much-needed construction.
Ireland introduced the controls in 2016, initially in urban areas, to slow runaway rental costs and buy time for housing supply to catch up with demand. However, homebuilding stalled at 30,000 units last year, far below the government target of an average of 50,000 new homes a year to 2030.
A 2% annual cap will remain in place for sitting tenants but landlords will be able to reset rents at much higher market rates between tenancies starting from March 2026 if a renter leaves voluntarily or breaches their agreement.
Research this year from Daft.ie, Ireland's largest property listings site, showed rents jumped by 47% for tenants who moved homes since the cap was cut to 2% from 4% in 2021, while rents for those who did not move increased by just 7%.
Apartment rent increases in new developments will no longer be capped at 2%, but can instead follow the rate of inflation, a change Housing Minister James Browne said was aimed at bringing back international investors who currently "won't look" at the market.
Ireland's central bank forecasts average annual inflation of 2.1% next year and 1.4% in 2027. While this would limit investor returns in the short term, Browne said it removed the tail risk of high inflation pushing investments into a loss.
Property developers have said rent controls, as well as higher interest rates, have choked the supply of new rental homes. The number of apartments built in 2024, largely earmarked for the rental sector, tumbled 24% year-on-year.
However, opposition parties have criticised the government for considering any changes, citing a more than doubling of rental costs since the aftermath of a property crash in 2013.
Browne said the changes were "just one strand of a suite of measures" that would include future actions in other areas to boost supply.
(Reporting by Conor Humphries and Padraic Halpin; Editing by Emelia Sithole-Matarise)
Ireland made minor changes to rent controls, allowing landlords to reset rents at higher market rates between tenancies starting from March 2026, while maintaining a 2% annual cap for sitting tenants.
Rent controls were introduced in 2016 to slow runaway rental costs and provide time for housing supply to catch up with demand, particularly in urban areas.
Research from Daft.ie indicated that rents jumped by 47% for tenants who moved homes since the cap was cut to 2% from 4% in 2021.
Housing Minister James Browne stated that the changes to rent controls are just one part of a suite of measures aimed at boosting housing supply in Ireland.
Property developers have criticized rent controls and higher interest rates for choking the supply of new rental homes, contributing to a shortage in the market.
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