The Private Rented Sector, Sacrificed for Home Ownership
||The Private Rented Sector, Sacrificed for Home Ownership
||8th European Real Estate Society Conference (26-29 June 2001) Alicante, Spain
||The private rented residential sector is crucial to the satisfactory operation of housing markets in European countries. It provides ready access to suitable accommodation on favourable terms, often without the necessity of a significant capital requirement. The Republic of Ireland is distinguished by having a very large owner-occupied sector at about 80% of households with the private rented sector amounting to just 11%. In recent years rapid economic development in Ireland has resulted in significant constraints emerging to the availability of accommodation generally, particularly in the private rented residential sector. Moreover, demand for labour in a rapidly growing economy is enlarging the requirement for accessible accommodation on terms that suit the increasingly dynamic population. This has given rise to considerable policy interest and debate about the role of the sector, the means whereby it should be regulated and, critically, the need to provide readily accessible and affordable accommodation for a more mobile population. Reflecting this the Irish government established a commission on the sector in 1999 to consider a wide range of the issues involved including affordability, security of tenure and investment incentives and returns. This reported in July 2000. Against the background of the report of the commission this paper commences by exploring the current state of the housing market and, in particular, the private rented residential sector. Second, there is a brief examination of the effects of past policies. Third, the paper considers policy options put forward to develop the sector; these include the means whereby additional resources could be attracted for investment, measures to regulate the landlord and tenant relationship and issues surrounding security of tenure and rent regulation. Finally, the paper considers difficulties of implementing policy options in the context of the existing tax regime and concludes that the dominant constraint on the development of the sector is the tax treatment of owner-occupied housing.
||Housing, private rented, rent regulation, security of tenure
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