ARREARS OF rent owed by tenants of Dublin City Council are set to reach €20 million by the end of this year, with more than a quarter of all tenants defaulting on their payments.
Rent arrears increased by €5.6 million in 2009 alone to €19.5 million, according to a report from the council’s housing division to be presented to councillors.
Some 26 per cent of the council’s 25,000 tenants are now in arrears of more than 12 weeks.
The council attributes the increase to the rise in unemployment in 2009 and the discovery of previously unreported income of its tenants.
The years “1995 to 2006 saw unprecedented salary/wage increases, which were often unreported for assessment purposes. In 2009, tenants were being made redundant and informing us. A lot of undeclared and unassessed income from previous years came to light,” the report says.
Although this gave the council a better picture of how much rent it was owed, the tenants who had been made redundant were no longer in a position to pay off accumulated arrears.
Despite the huge increases in unpaid rents, the housing division expects to stabilise arrears at about €20 million at the end of this year. Part of the reason for this stabilisation was its new maintenance and transfer policies introduced over the last two years which “encourage” tenants to pay rent.
Under the maintenance policy introduced in 2009, tenants who are more than six weeks in arrears will not be entitled to have routine maintenance work carried out. Similarly with the transfer policy, introduced this year, no transfer will be granted unless the tenant has a clear rent account for at least six months, unless there are exceptional circumstances.
The council has also assigned a full-time solicitor to pursue rent arrears in court.
This year warrants were issued in relation to 48 arrears cases. Settlements were reached with 38 tenants; 10 were evicted for nonpayment of rents. The report said that “further incentives” to encourage tenants to maintain clear rent accounts would be considered.
Labour councillor Seán Kenny has described the council’s rent collection policy as “shambolic”.
“For Dublin City Council to claim that the €20 million in rent arrears arose from undeclared earnings during the Celtic Tiger era is not credible.
“In my view it arises from a previous housing management policy failure.”
He said the council had let rent arrears slide during the boom because it was getting so much money from development levies and other property-based sources. The policy of not carrying out maintenance for those tenants in arrears was reprehensible.
“I would call on Dublin City Council to abandon its prohibition on carrying out housing maintenance for tenants who are in rent arrears, as it is causing hardship. If a private landlord was engaged in this practice they would be hauled before a Private Rented Tenancies Board tribunal.”
