‘Under-pressure’ rental sector becoming a threat to job creation

Ireland’s rental sector is under “enormous pressure” and is becoming a threat to job creation, according to the National Economic and Social Council (NESC).

The organisation, which reports to the Taoiseach on strategic issues relating to economic development and social justice, today publishes its report, ‘Ireland’s Private Rental Sector: Pathways to Secure Occupancy and Affordable Supply’.

In it, the group argues that tenants should be provided with more secure occupancy and that more affordable permanent rental housing should be made available for low- and medium-income families.

“Government policy has set affordability as the first goal of housing policy. This is potentially transformative,” said NESC director Rory O’Donnell.

“Taking up the affordability challenge in rental requires a commitment to an integrated approach. Such a strategy can be more than the sum of its parts — rent certainty, secure occupancy, tax treatment and others. It is this synergy that will transform the sector.”

The NESC’s vision and strategy is based on two core arguments — that Ireland needs a secure occupancy model and for new measures to be implemented to increase the supply of rental housing.

It argues that greater rent certainty can be achieved through a “disciplined market-sensitive form of regulation and adjustment” and wants to see a move from four-year leases to leases which are effectively indefinite.

It also advocates for the provision of low-cost loans, a reform of the tax treatment of rental income, vigorous delivery of the social housing strategy, and priority for investment proposals that underpin permanent provision of social and affordable housing.

The report is the NESC’s contribution to the Government’s development of a national policy for the private rental sector, including issues such as investment, standards and regulation, as indicated in Construction 2020 and the social housing strategy.

It is the third report published by the NESC on housing policy over the past year. The first of these reports, Social Housing at the Crossroads, published in June 2014, looked at the actions needed to support the development and financing of social housing in Ireland.

The second, Homeownership and Rental: What Road is Ireland On? examined the evolving balance between homeownership and rental accommodation. This was published in December 2014.

A further report on housing supply and land will shortly be published by the NESC. This forthcoming report sets out the case for a more active public role in driving housing supply.

In addition, the NESC will also publish a report commissioned from independent consultant Philip Lawton that examines the relationship between housing the development of sustainable urban communities.

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