In a private briefing to city councillors this week, senior local authority officials confirmed a rent raise from 17 percent of assessable household income, to 20 per cent of household income, will be implemented from January.
In real terms, this means each council tenant will pay nearly 18 per cent - almost one fifth - more rent annually.
Residents in receipt of a pension will be omitted from the rent hike, but a €5 per child weekly rent reduction for parents is to be scrapped. This element alone is understood to save the council a six figure sum annually.
Galway City Council has not raised rents for its 1,700 direct tenants, or 1,300 indirect tenants, since 2019. Around 300 tenants will not be affected by the rent hikes due to social welfare exclusions. HAP tenants, RAS tenants and Approved Housing Bodies tenants will all see higher rent bills. Tenants facing financial hardship will be dealt with sympathetically on a case-by-case basis by housing department officials.
Differential Rent Scheme rates for local authority-owned houses are set by the Council’s executive, and elected members have no role in confirming hikes or cuts. When first mooted by Galway City Council chief executive, Leonard Cleary, in June, councillors across all parties vehemently opposed increases, prompting Mr Cleary to delay his decision for a period of “reflection”.
Politicians' suggestions to stagger or delay rent rises have now been rejected, but councillors will discuss the issue at their monthly plenary meeting next week.
In July, Cleary explained that the council is expected to earn over €10m in total housing rent in 2025, but his proposals would increase that figure to just under €11.7m. Rent from the council's direct tenants brings in €4.4m per year since 2019, but €2.8m in rent arrears is understood to be currently owed.
In a statement, Galway City Council blamed construction material price inflation as a motivator for raising rents. "The cost of repairs, refurbishment and retrofit when re-letting a housing unit has surged from €7,649 in 2019, to over €41,000 in 2024," it said. The Council's current housing maintenance bill is €13.4m.
Social housing tenants in Galway city are not charged Local Property Tax (LPT ), whereas some long-term tenants of Galway County Council are charged LPT. It is understood this 13-year-old policy in the city may be up for discussion in the coming months.
LPT, and rates charged on commercial properties, are an important source of income to pay for the almost 1,000 services provided by the city council, which costs in excess of €100m to run each year.
“There is going to be a lot of consternation about this [rent] rise in many homes that may struggle to afford it,” said Councillor Shane Forde (FG ) after the briefing. “The reality is that [Galway City Council] should have been edging up the rent by – say – one or two percent every year or two, so increases were manageable. There seems to have been a lack of decision making in previous years, and now this current council is paying for the sins of others,” he said.
Meanwhile, an internal inquiry has been initiated in City Hall regarding private details contained in a council tenant's housing file appearing in a national newspaper last month.
