The sale of landlords only exacerbates our dysfunctional housing market

After months of nervous anticipation, the Class of 2022 has received its Leaving Cert results. These young adults are now going out into the world, making their own life choices and forging their own paths. But moving away from home soon could be a problem.

he youngest generation of school leavers will learn that finding a place to live is an unrelenting test. There is no grade inflation to make up for lost time and beds are scarcer than ever.

The shortage of rental housing is being exacerbated by a number of landlords exiting the market. Latest figures show that the number of landlords selling their properties has doubled in the past 12 months, with churn reaching unprecedented levels.

The trend is spreading as it encourages others to do the same. And who can blame them? It is often the so-called “accidental” landlords who drop out.

It is not opportunistic for those who have had rental properties in their hands due to a change in their circumstances to see the market’s return to Celtic Tiger prices as an opportunity to make money. After a period of negative equity where it was impossible to sell without a loss, it seems like an obvious time for many to pull out.

At a time when returns on other assets are still quite low, sticking with a rental property can make long-term financial sense. But many landlords now claim it’s just not worth the hassle, and they’d rather get out while they can. So much for John Stuart Mills saying: “Landlords grow rich in their sleep without working, risking or saving.”

Since the crash, successive governments have felt the only landlords willing to run them anyway are the big institutional investors benefiting from lucrative tax incentives.

With the flak targeting politicians with property of late, it seems unlikely there will be a change in policy for small landlords in the upcoming budget amid political fears of being accused of feathering their own nests. Rent controls are a vital safeguard in a rapidly evolving market, but it makes sense to assess whether a long-term freeze will only reduce supply and increase prices.

A year after the launch of the Housing for All plan, Taoiseach Micheál Martin says the government recognizes that “significant challenges remain” but the plan is having an impact. The jury is still out as the pace of progress is too slow. The housing crisis could hit a whole new low in the coming weeks if students are unable to study due to housing shortages.

A dozen years after the recovery, our housing market remains dysfunctional.

https://www.independent.ie/opinion/editorial/landlords-selling-up-only-further-exacerbates-our-dysfunctional-housing-market-41957866.html The sale of landlords only exacerbates our dysfunctional housing market

Fry Electronics Team

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