Council tenants allowed rent out rooms for up to €14,000 a year tax-free
Between 14,000 and 28,000 council homes are 'under-occupied'.
Between 14,000 and 28,000 council homes are 'under-occupied'.
Gabija Gataveckaite
Tue 2 May 2023 at 02:30
The Government hopes to add the equivalent of 28,000 homes across the country by allowing council tenants to rent out rooms in their houses for up to €14,000 a year, tax-free.
Under the current Rent-a-Room scheme, property owners can rent out rooms in their houses and apartments for €14,000 tax-free per year.
Senior ministers agreed at Cabinet to extend the scheme to all housing types, including local authority council homes.
For the first time, council tenants will also be able to rent out their spare bedrooms as increasing numbers of landlords sell up and the rental market shrinks.
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There are around 140,000 council homes across the country, of which between 14,000 and 28,000 are “under-occupied”, the Department of Housing believes.
This means there are a number of empty bedrooms in them, for example, in homes where pensioners live alone or families whose children have moved out.
Local authorities cannot compel council tenants to move out or downsize.
The Government now hopes to encourage those rooms to be rented out as part of moves to best use existing housing stock. “The idea is to incentivise people living in those homes, between 14,000 to 28,000 of those, to take up the Rent-a-Room scheme, open up their homes,” said a source.
“A lot of them are in good locations in towns and cities across the country, and that they wouldn’t be penalised and they are allowed do it.”
The Department of Housing is now working with the County and City Management Association (CCMA) to ensure tenancy agreements between tenants and the council allow the tenants to rent out rooms, if they wish to do so.
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Rooms being rented out in council houses or apartments will still have to be the main homes of the council tenants leasing them out.
Social welfare recipients and medical card holders can already avail of the Rent-a-Room scheme without it affecting their benefits.
The Housing for All progress update also states that local authority tenancies will be able to access the scheme.
The change does not require new laws and officials expect to have the necessary administrative changes made at some stage during the summer.
The move was signed off by ministers last week as part of a €1bn housing mini-budget to speed up the building of homes.
As part of the package, ministers signed off on up to €150,000 per every cost rental apartment developers build, increased grants for vacant and derelict homes and waiving of infrastructure fees.
A working group has now been set up within the department to finalise the details of the new viability supports for cost rental apartments.
The Government hopes this will speed up the delivery of housing and help meet annual housing targets, if not exceed them.
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