Rented from Private Landlords 2022

Introduction

This research paper has been prepared by the Central Statistics Office (CSO) as part of an exploration into the difference between Residential Tenancies Board (RTB) private tenancy figures and Census 2022 Housing figures on private landlords. This research paper was discussed at the Joint Committee on Housing Local Government and Heritage on 10 October 2023, at which the CSO outlined its work to establish the difference between the datasets and any additional information possible on the characteristics of the properties or the rental arrangements.

The Committee's discussion can be found at the below web link: Joint Housing Committee on Housing, Local Government and Heritage - 10 October 2023

The headline findings from Census 2022 were that 330,632 households indicated they rented their homes from a private landlord on 03 April 2022. The RTB published figure for the number of private rented tenancies registered with them as of 31 December 2022 was 246,453. This difference set amounts to 84,179 tenancies.

It should be noted that the original difference of 84,179 related to the difference between the RTB private tenancy figure on 31/12/2022 and the CSO's rented from private landlord figure from Census night on 03/04/2022.

After an extensive data matching exercise was completed, the final difference between Census 2022 data and RTB data was 73,002 unmatched private rentals (private rentals on the Census 2022 file but not matched in the RTB data). Throughout this research paper, reference is made to the difference between the two data sources as the 'difference set'. The difference set of 73,002 records is lower than the original difference of 84,179, due to the following reasons:

• If a property was found to be availing of the rent-a-room scheme in Revenue Rent Tax Credit data, it was taken out of the difference set.
• If a property was found to be owned by a local authority in Local Property Tax (LPT) data, it was removed from the difference set.
• Dwellings in which more than one household was recorded in the Census were also excluded.

Based on an extensive assessment of administrative data two categories were identified among the difference set as follows:

1. Dwellings with informal letting arrangements: Those rental properties which were not registered with the RTB and possessed characteristics which may indicate they may have been subject to informal rental arrangements.
2. Dwellings with formal rental arrangements: Those rental properties which were not registered with the RTB, but possessed certain characteristics which made them likely to be in the private rental market.

The analysis indicated the existence of 47,754 (65.4%) possible informal rental arrangements and 25,248 (34.6%) possible formal rental arrangements.

This paper uses Census information to provide additional insights to the characteristics of both of these categories. Reviewing the Census information under the headings Geography, Dwelling characteristics, Occupants' characteristics, and Monthly rent, the following was established:

• The possible informal rental dwellings were more likely to be located in predominantly rural areas.
• They were also more likely to be detached houses than possible formal rental dwellings. People living in possible informal rental dwellings were less likely to be unrelated to each other than those living in possible formal rental dwellings.
• They were also paying on average 30% less rent than the people living in the possible formal rented dwellings.

This work was facilitated through a data matching exercise using Eircodes as a unique identifier which helps identify records in both datasets and determines the difference set in Census records. Administrative data sources - such as the Revenue Local Property Tax - were also used to complement this analysis and the RTB provided different extracts from their data sources to resolve timing issues.

It should be noted that certain informal rental arrangements in the Irish housing market may be currently outside the scope of the RTB regulations - such as owners' relatives living in a property - but may still lead to a positive response on the Census form. Further information on the methodology and definitions used in this paper, are provided in the paper. It should be noted that the above figures are based on the CSO's interpretation of the categories for research purposes only.

It should be noted that, in accordance with the Statistics Act 1993, data published by the CSO is published in aggregate form only, which means no person or household can be identified from the data we publish. On this basis, no identifiable information related to the datasets analysed in this report can be shared with the Committee or the RTB.

Data Linkage

Census 2022 reported 330,632 private rental properties. As at the end of December 2022, the RTB had 246,453 registered tenancies, a discrepancy of 84,179. It should be noted that the Census 2022 data pertains to the night of 03 April 2022 which may have contributed to the discrepancy between the two datasets.

The principal way in which the CSO can add insight into this discrepancy is through linking to other administrative datasets that the CSO has access to under the Statistics Act 1993.

Linkage to other datasets provides additional contextual information that can facilitate statistical analysis of the discrepancies. Before this broader linking was done, the CSO first linked the Census 2022 and RTB datasets to establish which dwellings were common to both files.

Before the linking with Census was undertaken, 19,197 dwellings were removed. This was done for one of three reasons.

Firstly, the dwellings containing multiple households (11,794) in Census 2022 and were deemed unsuitable for analysis and removed. These were instances where more than one Census form was returned for an individual dwelling. This can happen when, for example, two separate households live in the same dwelling but maintain different housekeeping arrangements such as eating separately and not sharing common living spaces.

Secondly, 4,785 dwellings were associated with the Rent-a-Room scheme and therefore may have been more correctly reported as owner occupied in the Census.

Thirdly, dwellings which were owned by local authorities based on Local Property Tax (LPT) information (2,618) and may therefore have been more correctly reported as a local authority rental property in the Census were removed.

This left a valid analysis set of 311,435.

The Census 2022 and RTB data were joined using Eircodes. Of the valid analysis set, 238,433 (77%) were also found on the RTB file.

This left a discrepancy between Census 2022 and RTB data of 73,002 records.

Categorisation of Unmatched Dwellings

Having established the difference set of 73,002 records, the CSO used linkages to various administrative datasets to establish which of the dwellings within the set shared characteristics of other private rental dwellings registered with the RTB and which may have characteristics of possible informal letting arrangements.

Following a review of the administrative datasets available to the CSO, it was decided to link to the most relevant data sources comprising Principal Private Residence, Rental Income, Revenue Rent Tax Credit, and Housing Supports. This decision was made following a review of available datasets and based on criteria relating to the quality, completeness and coverage of the data available. In addition the datasets utilised had identifiers - such as Eircodes - that could be used to link between datasets.

On analysis of these datasets, we recognised four characteristics of a private rental property as follows:

1. Principal Private Residence

When paying LPT, a property owner must declare whether the property is their Principal Private Residence. A property that is being rented by registered rental agreement would not be expected to be declared as a Principal Private Residence.

2. Rental Income

Landlords in Ireland must declare rental income to Revenue. This is captured in the Income Tax Return and Self-Assessment Form 11. A return on this form is an indicator that the property owner is a landlord. Properties are more likely to be registered as privately rented if data indicates that the owner of the property (according to the LPT return) had self-declared rental income or if the property was owned by a company (also based on the LPT return).

3. Revenue Rent Tax Credit

If it was found that the dwelling or any of the persons living in it were in receipt of the Revenue Rent Tax Credit (tenant) in 2022 or 2023, it was more likely that the dwelling was subject to a registered private rental agreement.

4. Housing Supports

The Housing Assistance Payment (HAP) and Rent Supplement are social housing support schemes for people who have a long-term housing need. A person living in a property receiving support through the HAP scheme, a property registered with the HAP scheme, or a person receiving Rent Supplement are indicators that the property is a registered private rental property.

Based on an analysis of these datasets, the CSO allocated each of the 73,002 dwellings in the difference set into one of two categories.

The first category was for dwellings which had the characteristics of registered private rental dwellings for two or fewer of the above four characteristics. This category is termed Possible informal rental properties. There were 47,754 properties in this category.

The second category was for dwellings which had the characteristics of registered private rental dwellings for three or four of the above four characteristics. This category is termed Possible formal private rental properties. There were 25,248 properties in this category.

Examples of potential informal rental arrangements

There are several potential informal rental arrangements that may apply to dwellings allocated to the first category above. It is not possible to be definitive on whether these applied at the time of the Census, or which arrangements were in place. This list of examples may not be exhaustive.

• Informal letting arrangement whereby an owner lets the property to a relative or acquaintance for no or below market rent. This may also apply to non-traditional dwellings such as 'Granny flats' built adjacent to a property owner's residence.
• A property is made available to the occupant by their employer as part of the employment arrangement.
• Sub-letting arrangement between a prime tenant and an additional tenant.
• A guardianship agreement whereby someone is allowed to live in an empty property by the property owner for no or below market rent in order to ensure the property is maintained.

Geography

Table 1 in the Appendix displays the distribution of properties by local authority area.

Six local authority areas had higher proportions of properties which were found on both the Census and RTB files than the State average, which was 77%. These were Fingal, Galway City, Cork City, South Dublin, Dublin City and Dún Laoghaire-Rathdown.

The areas with the lowest percentage of matched properties were Donegal (57%) and Monaghan (58%).

The areas with the highest percentage of properties which were categorised as Possible informal rentals were Donegal (34%), Cavan, Monaghan and Galway County (31%).

The areas with the highest percentage of properties which were classified as Possible formal rentals were Clare and Monaghan, both around 11%.

Dwelling Characteristics

This section includes information from Table 2 in the Appendix relating to certain characteristics of the dwellings under analysis.

Nature of occupancy in 2016

The 311,435 properties under analysis were linked, where possible, to Census 2016 to provide information on how their tenure status was classified six years previously.

This analysis found that around 60% of the 238,433 private rented properties which were matched between the Census 2022 and RTB file were also categorised as private rentals in Census 2016.

Under half (45%) of the 47,754 properties which had characteristics of informal private rental arrangements had also been private rentals in Census 2016.

Nearly six in ten (58%) of the 25,248 properties which had characteristics of formal private rentals were also private rental properties in Census 2016.

Type of Dwelling

Looking at the dwelling type of the properties under analysis shows that among matched properties, terraced houses accounted for more than a third (36%) of the dwellings.

Detached houses accounted for 35% of dwellings in the Possible informal rented group.

Among Possible formal rental properties, 26% were semi-detached houses with a further 25% terraced houses.

Persons per room

Census 2022 data shows that properties which were either Possible formal rentals (78%) or Possible informal rentals (82%) were more likely to have fewer occupants per rooms than matched properties (73%).

Note: In Census 2016, 309,728 properties were classified as private rentals. Census 2022 recorded 330,632 private rental properties, an increase of nearly 7%.

Occupants' Characteristics

This section provides information about the occupants in the properties under analysis based on Census 2022 data from Table 3 in the Appendix.

Number of usual residents

More than half (57%) of Possible informal rental properties were occupied by one or two people.

Possible formal rental properties were more likely to have three or more usual residents than Possible informal rental properties.

Age

The average age of the head of household in Possible informal rented properties was slightly higher at 42 years than the other two categories.

Household Composition

More than a quarter (28%) of Possible informal rented properties were one person households, compared with an equivalent figure of 21% for Possible formal rented properties. Around 15% of Possible formal rented properties were households comprised of unrelated persons only, whereas only 8% of people living in Possible informal rental properties were unrelated.

Place lived one year ago

Among the Possible informal rented properties, the head of the household was more likely (84%) to be living in the same property as they had a year prior to the Census compared with the other two groups.

Monthly Rent

Table 4 in the Appendix contains information about the average weekly and monthly rent paid by the three categories of dwellings.

Based on Census 2022 data, the average monthly rent declared by households living in Possible informal rented properties was significantly lower than the other two groups.

In contrast, households living in Possible formal rented properties more closely aligned to the monthly rent being paid by private rental properties matched between the Census 2022 and RTB files.

The matched properties had a mean monthly rent of €1,265.

The Possible informal rented properties had a mean monthly rent of €806, approximately 36% lower than for matched properties.

The Possible formal rented properties had a mean monthly rent of €1,188, around 6% lower than for the matched properties.

It should be noted there was a higher prevalence of possible informal rented dwellings in predominantly rural Local Authority Areas. This may impact on some of the rent discrepancy as average rents are generally lower in rural areas.

Appendix

Public link

Please use the above public link if you want to share this noodl on another website.