In order to stop the rot, the Government have been making some efforts in the ambitious Housing for All plan (which seeks to oversee the provision of 33,000 homes per year until 2030) and one of the first strong initiatives to try to meet their targets looks like being the proposed €120,000 subsidy per unit to encourage the buildings of apartments in city centres.
Whatever about causing the costs of units to rise, it should at least provide an initial surge in apartment-building in the city centres.
The rent caps (currently limiting rental increases to 2% per annum) that the Government introduced a number of years ago are still performing a vital function in keeping rents in check – something that will become increasingly important in the coming months as inflation rates look likely to be in the region of 8.5-10% by the end of the year.
They (the rent caps) are doing their job in that they are keeping rental values in check in a fast-rising market. Conversely, they are also discouraging for the investor – particularly for the all-important small-time investor – because it limits the return on someone’s investment.
This is particularly true in the small minority of cases where an investor is looking to buy a property to rent but finds that the current rate being charged is well below normal market value.
The big picture challenges in the rental sector will rumble on for the time being, with some hope of improvement in the medium term. In the meantime, there is much reason to be proud of the Irish property management and letting sector, which continues to play its part as an increasingly important player in Ireland’s economy and society.