Estate agents require tenants of new Dublin developments to meet a certain income limit, at which rent cannot exceed 40 per cent of their net income.
This means that individual tenants who want to rent a one-bedroom apartment for EUR 2,000 a month would have to earn a gross salary of around EUR 95,000.
Some companies are now also charging prospective tenants just to apply for an apartment.
Multibillion-dollar US housing fund Greystar is charging tenants €45 to apply for accommodation at its Griffith Wood and Quayside Quarter complexes, where monthly rents range from €2,100 to €3,600.
Real estate sources say companies are conducting affordability checks to avoid delinquency.
But housing organizations say landlords should set rents at a reasonable level that suits the majority of people, rather than raising rents and then only looking for high-income people.
That Irish Independent applied for accommodation in a range of properties in the capital rented by some of the country’s leading real estate agents and was asked to provide details of gross income, occupation, proof of employment, bank statements and a copy of a passport.
An advert for a €2,546 two-bed apartment in St Clare’s Park, Harold’s Cross, posted on social media by a current tenant looking for a replacement, contained a list of requirements drawn up by estate agents Hooke & MacDonald were outlined. This included tenants providing a letter of employment, previous rental certificates and three recent bank statements.
There was also an affordability requirement that said rent could not exceed 40 percent of their net income.
Two tenants who want to live in the two-room apartment would have to bring home at least 6,300 euros net wages.
Developed by Marlet Property Group, St Clare’s Park comprises 220 apartments and a range of on-site amenities including a playground.
Parking costs an additional €50 per month, which adds up to €600 per year on top of the rent.
The development is billed as ‘pet-friendly’ – but rent is also charged for animals: renters are required to pay €50 per month per pet and a ‘pet deposit’ equal to 50 per cent of the monthly rent.
Businesses requesting financial information have become the market norm, and real estate agents ensure renters meet affordability criteria by requiring proof of employment and bank statements.
Damien Dillon, director of Dillon Marshall Property Consultants, said that while his company doesn’t have a specific income threshold, it’s “normal” for real estate agents to ensure tenants pay no more than 40 percent or 45 percent of their income on rent.
“We look at this on a case-by-case basis, but if someone earns €4,000 and pays €2,000 rent, we look at what the rest of the money goes to and if they can afford to live on it. Some people may have credit or a history of gambling and these things will be taken into account.
“It’s all about the well-being of the tenants, because we don’t want a situation where they can’t afford to live.”
Dillon Marshall currently has properties for sale on the Bay Meadows Estate in Dublin 15, with two bedroom single family home rentals starting at €1,975.
While anyone can attend a viewing, Mr Dillon said tenants who have reached the application stage would be asked for financial details.
The application process requires tenants to provide their industry, gross income, employer information, proof of employment, passport information, a reference from a previous landlord, and payslips for the past three months.
Greystar introduced similar requirements for prospective tenants wishing to rent apartments in its complexes.
Renters must provide their PPS numbers, salary data and proof of income once they have agreed to rent a property. The company previously said PPS numbers must be submitted to the Residential Tenancies Board when registering a lease.
Tenants must now also pay a €45 fee to apply for the properties, with the Griffith Wood complex also charging a €400 ‘hold obligation’ fee.
The housing association Threshold described such a practice as “extremely worrying”. “Renters are already collapsing under the weight of unsustainable rents and housing shortages,” a spokesman said.
That Irish Independent contacted Greystar and Hooke & MacDonald f or comment but got no response from either.
A survey by Rent Guard found that renters spend an average of 35.5 percent of their net monthly income on rent.
More than a quarter (28 percent) said they spend more than 40 percent, while some pay close to 50 percent.
Colette Bennett, Economic and Social Analyst at Social Justice Ireland, said looking at rent from an affordability perspective is “a good thing” while trying to keep rents relative to income. However, she said there were problems too.
“The way some ads appear to be presented relies on setting the rent and seeking income rather than setting it at a reasonable level that will work for the majority of people. This would exclude low- and middle-income families.”
The guidelines published by the Commissioner for Data Protection state that in his view there can be no justification for the extensive collection of personal data such as annual accounts and proof of financing in the initial stages of advertising or conducting viewings of a property.
However, she adds that this information can be requested once the applicant has been accepted as a tenant.
https://www.independent.ie/irish-news/news/renters-need-to-earn-salary-of-up-to-95000-for-some-new-developments-as-companies-now-doing-affordability-checks-41924598.html Renters must earn a salary of up to €95,000 for some new developments as companies now conduct affordability checks