West Mayo landlords exiting market as new rental rules loom

A wave of small landlords are abandoning the rental market in Westport, as new tenancy regulations set to take effect on March 1, 2026 spark fears of further housing shortages in the popular tourist town.

The real life fears of homelessness faced by the Barrett family, as told in this week’s Mayo News, could be the prospect facing many other renters in the town when their tenancies end.

At least 12 landlords have left the Westport district in the past six months alone, according to local property expert and estate agent Teresa Walsh, who warns that the exodus could intensify as existing tenancies come to an end.

The new rules, which still have to be approved by the Oireachtas, plan to introduce six-year tenancy terms for new rental agreements created after February 28, 2026. Under the changes, landlords would only be permitted to increase rent once every six years, with subsequent increases capped at either the rate of inflation or 2 percent, whichever is lower.

Landlords will be allowed to reset rents to market levels for new tenancies, but once set, they cannot adjust pricing for six years unless a tenant voluntarily leaves, breaches their obligations, or the property becomes unsuitable for their needs.

Critics of the planned changes say that new tenants will pay higher rents in the short to medium term before any potential gains in more houses and rentals coming to market are realised.

Small landlords 'running scared'

Walsh says the impending regulations are driving property owners out of the market rather than encouraging them to remain. “Landlords are running scared. They're selling their properties,” she said. “For some people, it may have been a pension plan. They became accidental landlords, potentially.”

She described the case of one landlord with three properties who has already sold two, with the third set to go on the market shortly. “Once they're gone, they're gone, they're out of the market,” Walsh emphasised.

The new framework classifies smaller landlords as those with three tenancies or fewer, with any non-subdivided property counting as a single tenancy. These landlords will have limited options to terminate tenancies during the six-year term, permitted only in cases of financial hardship requiring a sale or if they or a close family member need to occupy the property.

‘Taxed to the hilt’

Walsh argues that the tax burden on small landlords is a key factor in their decision to exit. “Small landlords are taxed to the hilt,” she said. “There should be an incentive for anyone that's providing housing to be taxed at the lower rate regardless of what that rent amount is.”

She contends the government should be “encouraging landlords to get into the market and not drive being driven out of the market full stop.”

The landlord exodus comes at a challenging time for Westport, an increasingly desirable location for workers drawn to major employers in the area. Walsh noted that companies are struggling to house their employees, with one hotel group purchasing properties specifically to accommodate staff.

“You have all the other people that come into Westport as a result of being a desirable town to live in, and they're coming in to work,” she explained.

READ MORE: ‘I’d nearly take them into my house if I had space for them’ - Mayo estate agent

Complex rules

Beyond taxation and inflexibility, Walsh says the sheer complexity of rental regulations is driving some landlords away. “A lot of them don't understand the rules, and they get afraid of it, and they said, 'it's too much stress. I'm getting out of it'.”

A particular concern is that once any pre-March 2026 tenancy ends, the property automatically falls under the new rules if rented out again. “That's why landlords are leaving,” Walsh said, adding that some property owners are delaying decisions until current tenancies conclude, meaning more departures could be on the horizon.

The new regulations will not apply to existing tenancies in place on February 28, 2026, local authority tenancies, or situations where tenants share accommodation with their landlord. New build apartments and student-specific accommodation will also be exempt from the 2 percebt annual rent increase cap.

A new Rent Price Register is set to be established alongside a legal definition of market rent as part of the changes.