knowledge 11 June 2025 |

Residential Rental Sector Reforms: What’s Changing and Why It Matters

Rent control

Significantly, an end to the rent pressure zone (RPZ) rent control regime will not come to pass. Instead, its reach will be expanded geographically, beyond the current specifically designated areas, to the whole country. This means that rents for tenancies country-wide will be subject to annual increases capped at the lower of (i) the market (ii) inflation and (iii) 2% (in times of high inflation and unless a limited exception applies).

An exception to the 2% cap on annual rent increases will apply for new apartments built on foot of a commencement notice lodged on or after 10 June 2025. Once set to market, the indications are that increases in rents for these apartments will be capped at increases in inflation only.

In addition, where any tenancy entered into on or after 1 March 2026 comes to an end otherwise than by a landlord on a “no fault” ground, the proposals indicate that when re-letting, the landlord will have an opportunity to re-set the rent to the market rent. There is a suggestion, although it is less clear, that an opportunity to re-set to market rent may also apply where a tenancy entered into on or after 1 March 2026 continues for 6 years.

Ultimately, the detail of the implementing legislation will determine how the new rules will take effect. In qualifying for the new rental exemption, the first tenancy in a new build is already exempt from the current cap. We would expect the application of the new rules to apartments to go significantly beyond that if it is to make the type of difference required to incentivise supply.

Security of Tenure

The new rent control measures are built on further reforms to the regulation of security of tenure, being the tenant’s right to remain in a property. While tenants generally enjoy tenancies of unlimited duration under the current regime, this is subject to the statutory rights of termination of the landlord. Currently those statutory rights apply where a tenant is in breach but also where the tenant is not at fault. The landlord’s “no fault”  termination rights may be exercised to facilitate the sale, renovation or change of use of a property or where the property is required for the landlord’s own or family accommodation needs.

The new reforms to this regime involve a new distinction between a large and a small landlord, with a large landlord owning four or more rented properties.

A large landlord will no longer enjoy the existing statutory rights of termination for “no fault”.

A small landlord’s statutory rights of termination for “no fault” will be restricted so that these will be exercisable at the end of each six-year period of the tenancy and only during any six-year period in circumstances of the landlord’s own hardship, or where the dwelling is required for the landlord’s immediate family member.

The rights for all landlords to terminate for breach remain unaffected. 

Conclusion

The Government’s proposals mark a significant shift in the regulatory landscape for residential tenancies. While the nationwide extension of RPZ rules and the redefinition of termination rights aim to enhance tenant protections, the real test will lie in whether these reforms can also unlock much-needed supply. The draft legislation will be critical in clarifying the scope and impact of the proposed exemptions and restrictions. With implementation timelines already in motion—RPZ expansion expected imminently and broader reforms by 1 March 2026—stakeholders should prepare for a period of active engagement and close scrutiny. We will continue to monitor developments and provide timely updates as the legislative process unfolds.