JERSEY’S Housing Minister has stated that he will “make a case” for a cap on rent increases – shortly after unveiling proposals to update the Island’s rental tenancy legislation.
Speaking during yesterday’s Environment, Housing and Infrastructure Scrutiny Panel hearing, Deputy Mézec acknowledged that such a move would be “controversial” but added that he believed there should be a limit on how much rents can be increased “in one go”.
His comments come just days after he issued an update on plans for a new residential tenancy law, which includes proposals for enhanced security of tenure for tenants and rent stabilisation measures – such as increases being limited to once per year and minimum notice periods for rent reviews.
He said: “I’m of the view that there ought to be a limit on how much rents can go up in a single rent review and that we should stipulate what the index for that limit is. This is something that is commonplace in lots of jurisdictions.
“In the standard Jersey tenancy, we already have a form of rent stabilisation, which says that rents cannot go up by more than RPI in one go. The standard tenancy contract is not compulsory, though, so of course lots of tenancies don’t fit that.”
He continued: “I would like to propose that some index is applied for how much rent goes up.
“We have asked the economics unit to look at what different indexes might look like and the impact it might have.
“I will then have to make a judgment call based on what evidence they give me, what model I would have the most confidence in believing will have a positive impact and mitigate some of the unintended consequences some people suggest come about when you apply these kind of indexes.
“That is going to be controversial – I have no doubt about that, but I will make a case for it and try to win people over for it.”
However, he noted that: “If I am going to impose some kind of index-linked cap on how much rents can be increased in one go, there does have to be some consideration about those circumstances where something happens to a property, or a tenancy relationship, where that cap is inappropriate.”
