Major Reform of Rent Pressure Zones Introduced Under the Residential Tenancies (Amendment) Act 2025

On 20 June 2025, the Residential Tenancies (Amendment) Act 2025 was enacted, bringing sweeping changes to Ireland’s Rent Pressure Zone (“RPZ”) framework. Originally introduced in 2016 as a temporary measure to address surging rents in high-demand areas, RPZs have now been extended nationwide, marking the first time Ireland has implemented a fully national rent control regime. The new measures, will be fully operational from 1 March 2026, introduce tighter rent caps, broaden applicability, and distinguish between small and large landlords for the first time in statute.

Background: The Evolution of RPZs

Rent Pressure Zones were first introduced in 2016. The intent was to address rent inflation in specific urban areas experiencing high and unsustainable rent increases. Initially limited to certain localities such as Dublin and Cork, RPZs allowed rent increases of no more than 4% annually and only once in a 12-month period. By mid-2021, the cap was further tightened to the lower of general inflation or 2% annually, due to persistent affordability issues.

Despite their temporary nature, RPZ provisions were repeatedly extended beyond their original three-year horizon. Most recently, they were set to lapse on 31 December 2025. However, the 2025 Amendment Act now extends RPZ rules to cover all private and student-specific residential tenancies nationwide until at least 28 February 2026, with new rules taking effect on 1 March 2026.

Market Context and Housing Data

The extension of RPZs comes against a backdrop of sustained rent inflation and a sharp reduction in the number of active landlords. According to the Housing Commission’s July 2024 Report, rents for new tenancies in Dublin RPZs increased by 6.5% annually and rents for existing tenancies increased by 5.1%.This trend has coincided with a 42% exodus of landlords from the rental market over the 26 months leading up to December 2023.

Key Amendments to the Existing Legislation

1. One of the most significant developments is the extension of RPZ rules nationwide, making this Ireland’s first truly national rent control regime. As a result, all residential lettings whether in high-demand urban centres or rural localities are now subject to RPZ constraints, unless specifically exempt.
2. Under the new legislation, rent increases are strictly limited to the lower of 2% per annum or the prevailing general inflation rate . Importantly, the limit applies cumulatively if no rent review has taken place for multiple years. For example, if a landlord has not reviewed rent for three years, they may increase it by up to 6% (2% per year), subject to compliance with notice and procedural requirements.
3. The 2025 Act also introduces new rules for determining rent levels when tenancies end and new ones begin. In most cases, the rent must be set in line with the amount paid under the most recent tenancy for that property. This includes existing tenancies where both landlord and tenant remain the same, a new tenancy with a different tenant, where the landlord remains the same, vacant properties that were previously rented and properties acquired with sitting tenants

However, from 1 March 2026, properties let after that date may have their rent reset to market value, but only where the previous tenancy was not ended on a “no fault” ground by the landlord. This incentivises the continuation of existing tenancies and discourages strategic terminations to facilitate higher rent levels.

Exemptions to RPZ Regulations

Certain categories of properties remain exempt from RPZ rules. These include:

• Properties that have not been rented in the two years before the new tenancy start date
• Protected or proposed protected structures not rented in the previous 12 months
• Properties that have undergone a “substantial change in the nature of the accommodation”

Additionally, new apartments constructed under commencement notices lodged on or after 10 June 2025 will not be subject to the 2% cap, though their rents must still rise in line with inflation.

Conclusion

The Residential Tenancies (Amendment) Act 2025 represents a fundamental restructuring of Ireland’s rent regulation regime. By extending RPZ rules nationwide, introducing tighter caps on rent increases, and drawing clearer distinctions between small and large landlords, the legislation seeks to balance tenant protections with market sustainability.

However, it remains to be seen whether these measures will slow landlord attrition or incentivise new supply, particularly in the context of continued rent inflation and limited housing stock.

How We Can Help

For specific advice on the Residential Tenancies (Amendment) Act 2025 or general real estate queries, please feel free to contact Hannah Kenny in our Real Estate Department (hkenny@bhsm.ie / +353 (0)1 440 8300).

This article is for general information purposes. Legal advice must be obtained for individual circumstances. Whilst every effort has been made to ensure the accuracy of this article, no liability is accepted by the author for any inaccuracies.