Rent freeze proposals would stymie investors: Broker
Rent freeze proposals will likely reduce the supply of houses by discouraging investors from entering the private rented market, according to a Goodbody report.
The broker's report comes after the political parties published their manifesto proposals to tackle the shortage of homes, high rents, and homelessness.
Citing experiences from Berlin and San Francisco, rent regulations can create larger shortages and lead to a decline in available rental supply, according to the broker.
The report by real estate analyst Colm Lauder and chief economist Dermot O'Leary also said that UK research suggests that controls reduce supply and would push landlords to leave the market.
Mr O'Leary said that the rental market had provided "exceptionally strong returns" over the past five years of 14% a year.
In Ireland, the analysts say that the private rental market "is undersupplied and underfunded" but says that "increased political interference will stymie supply".
A survey of landlords showed many would sell or cut back in the number of properties, according to the report.
The report says that Sinn Féin and Labour are proposing a three-year rent freezes on all residential tenancies among other regulations and proposals, while Fianna Fáil proposes no rent freezes but would strengthen rental pressure zones, and Fine Gael proposes reviewing rent pressure zones to see if they need to be extended or adapted.
Ireland, however, lags behind US cities and comparable European countries in building apartments.
It notes that the number of planning permissions has surged but that at around 20,000 units a year that the number of new home builds was currently meeting less than half of current demand.
Rental stocks are at record low levels, while affordability issues force more people to rent properties, and are priced out of the locations where they would prefer to live.
Citing CSO figures, the report says that around 24,000 new builds have been added "to the potential residential rental poll over the past 10 years".
