We’ll probably have to agree to disagree but what do you think is the primary reason that there has been a negative supply side response to the increased demand for rental properties?
Or to put it another way, why are we seeing a net decrease in rental properties at a time of increasing rents?
There been the death of thousand paper cuts to the supply of private rentals. There is no one reason, or a primary one.
But you have to say the catalyst for it all was the disposal of local authority housing and the cessation local authority building housing. That happened all over the developed world. On the back of privatization of many state assets and industries in the 80s. The commoditization of housing. The force adoption of that business on the private market, through legislation.
In Ireland it was mostly about outsourcing and cost cutting. As they've pushed a lot of the costs, like arrears and repairs to the private LL. Look at the arrears the local authority tenants have built up. How much was passed to the LL.
So you push social housing into the private market and you push that pressure up into the rest of it. LL's look for any way out of it, high rents, high deposits, rent a room. AirBnB etc. Every avenue is cut off with legislation. Ultimately the point of being a Private LL is rental income and capital appreciation for low risk. You've now made it high risk, rental income is constricted forever and the the capital appreciation has already been achieved. The population of LL is also aging, the cost of entry is too high for new landlords and institutional large LLs get preferential tax treatment. Those large LLs targe mostly the most profitable section the high end, the smaller landlord the low end.
This all plays out against the background of the Celtic tiger, boom and bust, and the over fueling of the economy and population growth.
Rent controls are just one part of that puzzle.
youtu.be