DCC seeks to rent from private landlord

Under HAP the local authority commits to pay up to 87% of the rent to the landlord on behalf of the State

Dublin City Council has approached Ireland's largest private landlord seeking to rent apartments for social housing tenants despite accepting that such moves will add to rent inflation.

It comes after I-RES Reit confirmed last month that it had almost trebled the number of State-funded social tenancies on its books.

The Department of Public Expenditure and Reform recently recommended that the State place a greater focus on building social houses rather than renting privately.

Information obtained by RTÉ's Morning Ireland through Freedom of Information shows a senior staff officer in Dublin City Council's Homeless Housing Assistant Payment (HAP) section emailed I-RES Reit earlier this year enquiring about reserving units in the company's developments.

Under HAP the local authority commits to pay up to 87% of the rent to the landlord on behalf of the State.

Monthly HAP payments of up to €1,950 are available for families at risk of homelessness.

I-RES Reit recently announced profits of €19m for the first half of this year.

The email, dated 22 May, outlines the benefit of a HAP tenancy to I-RES and explores the potential for the local authority to reserve units.

"We can pay the upfront rent/deposit and then nominate families who are interested in living in the development," the official writes.

A meeting is held later that month to view potential properties, details of which are redacted from the emails disclosed under FOI.

On 7 June an official from I-RES emailed the local authority thanking them for the meeting and adding, "I hope you thought the apartments were as lovely as we think they are."

It explains how a number of apartments have been reserved for Dublin City Council located on different floors and in different complexes.

The correspondence ends with the hope that it would be the start of a "wonderful partnership going forward between I-RES and Dublin City Council."

In an interview with RTÉ's Morning Ireland, Brendan Kenny, Deputy Chief Executive of Dublin City Council, who has responsibility for housing, said he was "very happy" to see I-RES Reit involved in the provision of HAP.

"We have no qualms about dealing with any landlord who provides good accommodation.

"At the end of the day for people on the housing list they don't really mind where the property has come from."

Mr Kenny accepted that a large volume of HAP tenancies increased demand in the wider rental market and caused higher rents for other, private tenants. 

"Yes, it is adding to rent inflation but we have to provide accommodation and take what we can get."

Under legislation landlords cannot discriminate against HAP tenants. A spokesperson for I-RES Reit said the company is happy to facilitate such tenancies.

The number and location of the units under consideration were not released under Freedom of Information. Dublin City Council says it currently has 175 tenancies with large landlords, such as I-RES.

The documents show how in a subsequent email council staff outlined how there was huge interest in such properties.

"I think we could have filled double the allocated amount," the official writes.

It adds that the Council would like to "get our foot in the door in advance" if I-RES has plans to purchase any similar developments.

Michelle Norris, Professor of Social Policy in UCD, said although Dublin City Council was experiencing an "enormous housing shortage" an over-reliance on HAP leads to inflation in the wider rental market.

"Because HAP is not evenly distributed around Dublin it has a very big impact on rents in some parts of the city and a very big impact on rents at the bottom of the market.

Professor Norris said she understood why the council was reaching out to large landlords in the short-term, but that concerns remained over a "bigger shift in housing policy".

"In the past we invested in building or buying social housing but we have moved away from that to subsidising rents. It doesn't provide as good value for money and it has knock-on negative impacts like inflating rents further and making the situation worse."

The Department of Housing said that by 2020 it will be housing more people using builds and acquisitions rather than through the HAP rental scheme.