Latest news with #Daft
Irish Examiner
13-06-2025
- Politics
- Irish Examiner
Rosita Sweetman: I was poor when the country was — being poor in a rich Ireland must be torture
Being 'poor' is miserable. Being poor in an affluent society is torture. Ireland is now, statistically, one of the richest countries in the world - but child poverty, or children in consistent poverty, has increased by an astonishing 78% in the past year, according to a new report. And renting a house, never mind buying a house, for you and your children, has never been more difficult. This week the Government serendipitously announced its plans for the housing market where rents on Daft show new build apartments in Dublin (seemingly made mostly of MDF) are €2,300 for a single bed, €3,500 for a double. So what does our delightful new government do? Sadly, far from beating their breasts, saying, our nation's children should not be in 'consistent poverty', our lovely young people should not be beggaring themselves to rent or buy a home, our old people should definitely not be forced to sell their homes and go into so-called 'homes' where they could be neglected or even unsafe, the Government plan to bring in legislation that will enable landlords to raise rents even higher. They say it's the only way to increase supply. In a way, it's not surprising. We've been bastards to each other over property ever since the Famine, when Gombeenism, (ie taking over your dying or emigrating neighbour's gaff) signalled the birth of native capitalism. It's a tradition so ingrained that many of our politicians run side hustles as landlords. Remember the Celtic Tiger, when Bertie and Co whipped the country into a frenzy of acquisition that everyone knew was going to end in a massive crash? And when the crash hit the property boys circled the wagons, bailed out the banks, created Nama. Welfare was slashed. Supports for the vulnerable were slashed. Social and affordable builds came to a stop. Hospitals and schools had their budgets shaved to the bone. New entrants to teaching, nursing, the police, the civil service got salaries a fraction of their predecessors'. Housing regeneration projects in the most deprived areas were abandoned. To top it all the 'poor' were openly derided. Remember a plush, well fed Leo Varadkar and his 'Welfare cheats cheat us all?' schtick? A slogan that whitewashed the reality: since the crash the wealthy have been increasing their take, worldwide. A 2024 Oxfam report showed that billionaire wealth increased by €13 billion in 2024, or €35.6 million per day. It's the dodgy ground on which our current crisis is built. Poverty in the 90s Going through papers and photograph albums recently for my memoir, ' Girl with a fork in a world of soup', I was struck over and again how poor my children and I were in the 90s when my marriage crashed. We were lucky in one way, I'd managed to keep our home (despite vigorous attempts to ensure the opposite by my ex), we had a roof over our heads. But with the charmingly named 'Deserted Wives Allowance' then IR£69 a week, heating the house was not possible. Mould marched the walls. Eating right was not possible either. We went from proper hot dinners to yellow pack pizzas. All our clothes came from charity shops. I had unpaid bills in every small supermarket for miles. "Everything in this house is broken," said the son of one of the school mums who came to visit. She was mortified but he was right. You think you live in a decent society, that there will be a safety net when you fall, but no. The children and I fell and fell through a whistling void. As we went down I sold paintings, rugs, desks, cabinets, more paintings. Anything I could lay my hands on to keep us afloat. I went to the family lawyer to find he was now working for 'the other side', ie my ex. I went to Social Welfare who said they couldn't help since I was still 'technically' married. I went to a GP who said I should take a holiday, away from the children; I seemed "very stressed". Through gritted teeth I explained I didn't have enough money to get to the end of the week, never mind go on holiday, never mind getting someone to mind the children who anyway were also deeply traumatised and would have suffered more if I'd left. I went to the local priest. He almost tore his soutane in half, slamming the drawer of his desk, stuffed with cheque books and see-through envelopes bulging with rolls of notes. Once a film company used the house as a location. When their cheque for IR£1,300 was read by our local bank as IR£3,300 I whooped. Money! When the bank took me to court their representative said: "She went to DID Electrical the next day and bought a new washing machine, and a fridge!" As if I'd blown their precious loot on heroin. Thankfully that judge was just. The case was dismissed. For once, it wasn't Josephine Soap's fault. It was the bank's. For not reading the cheque properly. Hurray! The Dublin housing market When, after 17 years, the children and I were forced to leave our home for other reasons, we encountered the Wild West that is the Dublin rental market. Oh boy. The first home we got was a beauty but at €2,300 a month roared through the money my mum had left us. The next house - about one tenth the size of the first - was a former groom's habitat off South Circular Road. Then it was an old Georgian off Leinster Road with cartoonishly avaricious landlords. When we asked permission to strip out an old and stinking carpet and paint the three flights of stairs white they agreed. Then they served notice. The place looked so lovely it was going back on the market the following week at twice the price. The next landlord was an ex-garda. When he couldn't legally hike his rent he booted us on the grounds his daughter was moving in and charged us for 'cleaning' new curtains, bringing the pine table and the sofa we'd left behind to the dump. When I looked through the window a month later there were strangers, enjoying our stuff with nary a daughter to be seen. When I tried to take up the case with the PRTB - the Private Rental Tenancies Board, it went nowhere, and of course the PRTB replaces all recourse to the courts, so that was that. Happy Gombeening. Rosita Sweetman: 'When, after 17 years, the children and I were forced to leave our home for other reasons, we encountered the Wild West that is the Dublin rental market. Oh boy.' Throughout our shenanigans I had the advantage of being educated. Of having a voice, however small. Imagine the despair trying to navigate this entanglement without those advantages? Being poor is miserable. Being poor and at the mercy of landlords who've basically been given free rein is going to be terrifying for so many. Being the child of poor parents at the mercy of this system has got to be the worst of all. Come on Irish government. We're rich. We have billionaires amongst us. We can do better than this, for everyone. Can't we?
Irish Times
10-06-2025
- Business
- Irish Times
Landlord tax returns hit by Revenue technical glitch
It may have been announced back in 2023, but this is the first year that residential landlords can avail of a new tax relief. Aimed at keeping smaller landlords in the rental market, the incentive could be worth as much as €3,400 between now and 2027. The catch? If you sell the property within four years, the relief will be claimed back. There have already been issues with the new incentive, as efficient early filers of income tax returns discovered. The credit was being calculated incorrectly by Revenue , which meant that landlords were only benefiting from a deduction of €120 – instead of €600. Separately, for some landlords who might be thinking of selling up, the credit is seen as being too little too late. READ MORE On the other side of the equation, of course, are hard-pressed tenants, who, according to latest figures from Daft, are now facing average monthly rents in excess of €2,000 for the first time. They might wish that any tax incentives offered go in their direction – even though Revenue figures suggest a large number have yet to claim rent tax relief to which they are already entitled. [ Revenue appeals to more taxpayers to claim money they are owed Opens in new window ] Here, we take a look at how the scheme for landlords will work, and just how much you should be entitled to back if you rent out a property. Introducing the relief in Budget 2024, then Minister for Finance Michael McGrath said the Residential Premises Rental Income Relief , which allows landlords to reduce how much tax they must pay on rental income, was a 'temporary' measure, primarily to benefit small landlords. To qualify, you must fulfil certain conditions, such as being compliant with local property tax, and either have a tenancy registered with the Residential Tenancies Board or a local authority, or have the property marketed for rent. 'Effectively you'll pay €600 less tax this year,' says tax adviser to landlords Brendan Allen of the relief. The big red flag here is if you're renting the property to a family member or relative, in which case Revenue says you can't claim the relief. Tech glitch Some early birds got a bit of a shock earlier this year, when they filed their tax returns for 2024 only to discover Revenue was offering a much lower rate of benefit – 20 per cent of €600, which was just €120, rather than the full €600. According to a spokeswoman for Revenue, this impacted about 2 per cent of the 51,000 returns (so about 1,000 landlords) who had filed between January 1st and March 24th. At this point, she says, the system was fixed. The spokeswoman says that once the issue was identified, Revenue engaged with tax practitioner bodies and relevant third-party software providers to make them aware of the issue. It has since commenced a review of all impacted returns, 'and will correct any returns which require an amendment'. She says taxpayers are also able to amend their self-assessment return themselves, if they wish, through ROS. It will then apply the updated calculations automatically in such cases. That's not the only glitch, however. Revenue has told tax advisers that a separate calculation issue is impacting cases of joint assessment, where ownership of the qualifying premises is shared. This resulted in the duplication of relief. It is expected that this will be fixed by June 21st. Again, Revenue says it will fix any returns which have been impacted. How it works The relief is offered at a rate of 20 per cent of the landlord's rental income, up to a limit of €3,000 in 2024, €4,000 in 2025 and €5,000 for both 2026 and 2027. This means that the most you can claim when you submit your Form 11 tax return for 2024 (deadline November 13th 2025 for online returns), is €600, rising to €800 next year, and €1,000 for 2026 and 2027. That amounts to total relief of €3,400 between now and the scheduled end of the scheme. It applies to income tax only, so it will not reduce the amount of PRSI/USC that you owe. If you're self-assessed, you'll find a new Residential Premises Rental Income Relief section on ROS, through which you can apply for the relief. Allen points out that you'll find the relevant section at question 207 on page nine of your tax return. Not every landlord might get the full rate of relief. According to Allen, if your rental profits are less than €3,000, the relief will be restricted to 20 per cent of the taxable profit. So if, for example, your profits are €2,000 for 2024, then you'll only be able to claim relief of €400. The relief is also offered on a per person basis, so if you have five properties that you let, you'll still only be able to claim a maximum of €600 for 2024. Allen says some landlords feel they were 'misled' by the Minister on this point, as many thought it was being offered on a per property basis. In addition, if a property is jointly owned, the €600 can be divided between owners in proportion of their ownership. 'It's quite restrictive in that sense,' says Allen, noting that tenants can avail of a rental tax credit of up to €1,000 a year – and where there is a couple, this can be worth as much as €2,000. The relief on offer to landlords is some way short of this. Clawback And if, as a landlord, your plans change, you must be prepared to lose out on the incentive. According to Revenue, you'll have to give back the relief if you sell the property within four years of the first year in which the relief is claimed – or if you transfer it to someone else. Similarly, if there is a change of use in the property – for example, it's not being rented out or marketed as such, or it is being used as a holiday home – then you could face a clawback. And if you let it to a 'connected person', such as a family member, this can also trigger a clawback. So should you wait until the end of the four-year period to claim the relief? Allen doesn't think so, noting that many landlords are currently struggling with higher expenses and an inability to increase rents due to rent pressure zones. 'Interest rates have gone up but your income as a landlord is capped,' he says, adding, 'I would envisage that most landlords would claim it in the year it might be allowed.' Amid a background of smaller landlords leaving the rental market – Sherry FitzGerald said in April that about 30 per cent of their sellers during the first quarter of 2025 were landlords – the question is, will the new incentive keep a broader rental market in place? 'Any tax credits are very welcome, and we do need them but it won't change anybody's mind about whether you're going to stay as a landlord or not,' says Allen. 'Taxation is one matter but over-regulation and the ability of the Residential Tenancies Board (RTB) to deal with things is another.' He suggests other steps that could be taken, such as allowing landlords' rental income to be treated in the same way as any other trade. This would allow for a greater level of tax deductible expenses. Another option could be to bring back a capital gains tax exemption for those keeping properties for a certain period of time, such as was introduced back in 2011. And there is the issue of rent pressure zones, with the current regime due to end in December of this year. Allen would like such controls to come to an end. 'What I'd like to see is the zones ended. There will be a period of adjustment, but it will very quickly resolve the challenges of keeping properties in the rental market,' he says.
Extra.ie
01-06-2025
- Entertainment
- Extra.ie
Thalia Heffernan says she thought she would 'end up homeless' as she shares house hunt update
Thalia Heffernan has admitted 'there was more than one time that I thought I was going to end up homeless,' as she provided a life update this weekend. The model detailed the struggles she faced as she house-hunted in the midst of a housing crisis. With a severe housing shortage in Ireland at the moment, Thalia's bid was made even more difficult with her two beloved dogs. Thalia Heffernan has admitted 'there was more than one time that I thought I was going to end up homeless,' as she provided a life update this weekend. Pic: Thalia Heffernan/ Instagram Fortunately, the 30-year-old has revealed she has now moved into her new home, as she encouraged anyone going through a tough time to push through '[they] don't last,' she promised. Taking to Instagram on Sunday morning, Thalia shared a series of clips from her life lately including clips of her chilling in her new home, moving houses, getting active and socialising with friends and family. The Dublin native admitted she had been 'losing the will to live' recently as she moved houses in the middle of a housing crisis. She said: 'I spent weeks trying to find somewhere to live and to be honest, there was more than one time that I thought I was going to end up homeless.' The former Dancing with the Stars contestant detailed how she tried to keep things normal in the midst of 'checking my Daft notifications and emailing estate agents like a crazed ex.' She said: 'I had to just try and keep going. I know these videos are beautiful with work trips and sunny days and hugging lambs but it just goes to show you really never know what people are going through. Thalia Heffernan expressed her gratitude to her friends and family who got her through the difficult process. Pic: Thalia Heffernan/ Instagram 'In very typical fashion it wasn't just trying to find a house that was going wrong, but living out of a suitcase for awhile and having to find joy in the smallest moments really taught me quite a big lesson.' Thalia expressed her gratitude to her friends and family who got her through the difficult process and shared words of wisdom for anyone going through their won thought times. 'Promise you'll get stronger in the process,' she shared, 'I'm not going to be one of those a*****es who says that God gives his toughest battles to his strongest soldiers but maybe they've got a point.' Friends and followers took to the comments to extend congratulations, with Limerick model Shauna Lindsay writing: 'Delighted you got a place! New beginnings girl.' Paralympian Ellen Keane added: 'Moving is THE WORST thing in the world. Especially trying to find a home with your 2 babies. Hope you make amazing memories in your new place.' A third shared: 'So stressful, glad to hear you got sorted!'
Irish Times
23-05-2025
- Business
- Irish Times
‘What we are experiencing in Ireland is actually a problem of affluence'
Year after year, policy after policy and invariably the result is the same: soaring prices and sky-high rents. It's hard to keep applying the term crisis to Ireland's housing problem when it's been going on for two and a half decades. The home ownership rate among those aged 25-39, once considered a prime homeowning age, has dwindled to just 7 per cent. This is less than a third of the rate recorded in 2011 (22 per cent). READ MORE The declining rate of home ownership has created an oversubscribed rental market, which this week delivered another grim milestone. Property website Daft reported that average monthly rents in the first quarter eclipsed €2,000 for the first time. That figure is also nearly three times what it was in 2011 (€765). And the Government's answer? A dedicated housing tsar to head the Department of Housing 's new 'housing activation office'. The Government says the establishment of the office is needed to 'ensure a radical step change in housing supply' and to quickly address 'barriers to the delivery of vital public infrastructure projects needed to enable greater housing development'. The Department of Public Expenditure has – at the same time – created its own dedicated infrastructural unit, which it says will work with the housing department's one. [ Average monthly rent exceeds €2,000 for the first time Opens in new window ] But why are we only tumbling to this now and why do we need new units – more layers of bureaucracy – in already well-resourced departments? Critics say the Government (and Fine Gael in particular, which is in its fourth consecutive term in office) has run out of ideas and is merely setting up another quango to disperse the political heat. The debacle over the possible appointment of Nama boss Brendan McDonagh to head the housing activation unit (and with a salary of €430,000) capped a pretty awful honeymoon for the new Government. Nama tends to polarise opinion. If the agency's remit was to 'cleanse and repair' the balance sheets of the Irish banks while getting a return for the State from managing distressed property assets, it and McDonagh can claim to have succeeded (the agency is expected to make a profit of approximately €4.9 billion). But the agency, at one stage, had most of the State's prime development land on its books, which many believe presented the State with a strategic opportunity to do something big on housing, an opportunity that wasn't taken. [ Holiday homeowners underestimate at their peril the anger among those locked out of the housing market Opens in new window ] According to its latest annual report, the agency facilitated the delivery of 37,700 new homes in the 10 years to last March. Another reason why the Government finds itself in such hot water on housing relates to last year's election promises. Part of the Government's pitch to voters was that the State had turned a corner on housing and that the supply of new homes would hit 40,000 in 2024. Instead it went the other way with new home completions falling by 7 per cent to 30,000. The Government's social and affordable housing targets were also missed. Worryingly, housing commencements (the strongest indicator of future supply) have also fallen off a cliff. Partly because Government waivers on levies artificially pumped up the number last year but also because there's been a fall-off in construction activity, housing starts in the first quarter of 2025 were eight times down on last year and at their at their lowest level since 2016. The Housing for All output target of building 41,000 new homes in 2025 is now seemingly a lost cause. Newly installed Minister for Housing James Browne can rightfully feel he's been given something of a hospital pass. Next up for him and the Government is a tricky decision on rent controls. Industry is pushing hard for the State's rent pressure zone (RPZ) system, which limits annual rent increases to 2 per cent or the level of inflation (whichever is lower) and which expires this year, to be overhauled to entice more investment. But Opposition parties claim any loosening of the rules will accelerate already high rents. The author of the Daft report, economist and Trinity College professor Ronan Lyons, claims Government interventions aimed at easing the housing crisis have, in fact, exacerbated the problem. He zeros in on changes made to rent controls in 2021 that reduced the permitted annual increase from 4 to 2 per cent. This 'dramatically reduced the ability of Ireland's rental sector to attract the capital needed for new supply, the ultimate remedy for the shortage', he says. 'The irony is that the last Government scrapped pro-supply policies just as they were beginning to show their effects – with market rents in Dublin largely static in 2023, due to lots of new completions, even as rents surged in other cities,' Lyons says. He praises the 2016-2020 Government for adopting pro-supply policies like the Build-to-Rent and Strategic Housing Development initiatives. 'Combined with a favourable macroeconomic environment, these generated a pipeline of tens of thousands of new rental homes, albeit concentrated in the Greater Dublin Area due to viability challenges,' Lyons says. At one stage in the late 2010s, there were up to 100,000 rental homes (mainly apartments) in the pipeline (25,000 have been delivered so far). Lyons claims the 2020-2024 Government, however, reversed the pro-supply policies of its predecessor. 'Together with the change in external conditions and a sharp tightening of RPZs, in effect making them one of the strictest rent control regimes in the world, this had a catastrophic effect on the supply pipeline,' he says. Before 2020, he says the Republic was getting about 14 per cent of the capital investment in housing coming into the UK and Ireland (punching above its weight) but is now only getting 3-4 per cent. 'Some people will say, oh sure everywhere has seen a fall-off in residential investment [because of higher interest rates]' but Lyons says Ireland has become comparatively less attractive because of strict rent controls. Under consideration is a move to a system of reference rents, as the Housing Commission has advocated, where rent limits are related to factors such as location and property size. Others favour letting landlords reset rents to the going market rate between tenancies. Cairn Homes boss Michael Stanley insists Ireland has enough bedrooms to solve the housing crisis 'three times over'. Assuming there are 2.1 million housing units in the State (mainly three- and four-bed homes) that means there are roughly 6.7 million bedrooms for a population of 5.3 million, he says. His person-to-room argument isn't intended as a solution but as a preamble to his main contention namely that Ireland needs smaller housing units, in other words more apartments. Stanley says there is a notion that Irish people don't want to live in apartments, which is not true. 'It's the greatest piece of misinformation that's put out there,' he says, highlighting the strong demand for new apartment schemes. Apartments comprised 60 per cent of Cairn's sales last year. Density or the lack of has long been cited as a big factor in Ireland's housing problem. About 10 per cent of people here live in apartments versus an EU average of 47 per cent, Eurostat has reported. The State has made things difficult for itself by building out instead of up. Wraparound infrastructure – transport in particular – is harder to deploy with such a scattergun approach to housing. Even Dublin City Council's plan to develop 6,000 homes on a 77 hectare tract of land at the Dublin Industrial Estate site opposite Glasnevin Cemetery is deemed by many to be too low density. Stanley also claims the industry won't be able to build 50,000 homes a year (the State objective) without building 25,000 apartments a year, but the lack of high-density zoned land in cities is frustrating this aim. He says approximately 70 per cent of the zoned land across the eight local authorities responsible for most of the homebuilding in the State has density requirements that do not allow apartment building. Another central problem is the high cost of apartments. Property group Hines, the company behind the large Cherrywood housing development in south Dublin, says space standards and build quality requirements combined with the absence of VAT on new housing in Northern Ireland means that a housing unit that costs €300,000 in Belfast costs €496,000 in Dublin. If housing is absorbing more and more of the political bandwidth, it is also absorbing more and more of the State's finances. Total State, or State-backed investment in housing, last year was approximately €5 billion with the number of schemes and measures – to activate construction, to build more affordable homes and to help buyers get on the ladder – continuing to grow. Once seen as a game-changer, the Land Development Agency (LDA), which has a remit to build affordable housing on State land, has seemingly been bogged down in planning and/or the slow pace of obtaining land from commercial and other state bodies. Insiders say the agency is finding it easier to build on private land than on the land we as citizens already own. It aims to deliver 14,000 new homes over the next three years. Of course these are supply-side issues. The main problem for buyers and renters is price. The average price of a home in Dublin is now over €600,000, the CSO has found, 12 times the average full-time salary in the State (which is about €50,000). The average price paid nationally is over €430,000. 'Demand clearly exceeds supply and this is reflected in the pricing signals – rents and house prices are both rising in real terms,' lecturer in property economics and real estate at TU Dublin John McCartney says. However, he questions the widely held assumption that this reflects the failure of construction to keep pace with population growth. 'In fact, and contrary to the public perception, a combination of new builds and absorption of vacant properties provided enough accommodation to keep pace with growth in household numbers between 2011 and the most recent census,' he says. 'Housing demand is actually about the willingness and ability of society to pay for housing rather than being about population growth per se,' McCartney says. 'What we are experiencing in Ireland is actually a problem of affluence – there is just a huge amount of money chasing homes,' he says. 'Partly this is because of Ireland's economic good news story – full employment, rising real wages, tax cuts etc, and we certainly wouldn't want to change those things,' McCartney says. He also notes that some of the demand is being driven by Government incentive schemes like the Help to Buy, the First Home Scheme and the local authority home loan scheme 'which are unnecessarily fanning the flames of inflation'. Either way, Ireland's housing problem has become increasingly tangled with the Government still searching for the right policy mix and investors citing policy uncertainty as a key turn-off.
Irish Times
21-05-2025
- Business
- Irish Times
Government can kiss goodbye to its plan for lifting the rent cap
The news that rents are climbing at their fastest rate in 20 years and have passed €2,000 a month nationally should, in theory, put the kibosh on any plans to lift the cap on rents that applies in pretty much every urban area of the State. The Government has been trailing the idea since the last election, based on the premise that it will kick-start development, particularly the sort of large apartment schemes considered crucial to making a dent in the housing shortage . Even allowing for the fact that the figure of €2,000 per month contained in the Daft quarterly rental report is asking rents – for properties that are coming to market, including new builds exempt from the rent cap – the lifting of the cap now looks like a non-starter politically. The construction industry argues, rather counterintuitively, that ever-rising rents simply bolster their argument for doing away with the cap The true picture may be somewhat different. According to the most recent report from the Residential Tenancy Board, the average rent for new tenancies nationally rose by 5.5 per cent year-on-year to €1,680 in the fourth quarter of 2024. It rose by 4.6 per cent year-on-year for existing tenancies nationally to €1,440. READ MORE This is a moderation in the rate of rental inflation, it argues, but the problem for the Government is that the figure that matters is in the Daft figure as that is the one the Opposition will use to beat them up in the Dáil should they lift the cap and expose sitting tenants to significant increases. The construction industry argues, rather counterintuitively, that ever-rising rents simply bolster their argument for doing away with the cap. They are right up to a point. The reason rents are rising is because there is insufficient supply. The number of new homes commenced so far this year is eight times lower than the comparable period last year and at its lowest since 2016, according to the Department of Housing . 'I've entrepreneurial spirit in my veins' – Apprentice star Jordan Dargan Listen | 44:45 According to the industry a negative feedback loop has set in. Rent caps are discouraging investors and developers from building apartments and houses for rent and this is squeezing supply, which in turn is pushing up rents to record levels. The solution, they argue, is to remove rent caps and allow rents to move until such time as a positive feedback loop sets in. Leaving aside the possibility that capitalism is broken beyond repair, there is no doubt that the Government is in a very tricky place Of course, it won't work that way – not in the short term at least – and actively encouraging such an inflationary cycle brings us one step closer to the sort of housing market crash that some think is the only way out of the current mess. Leaving aside the possibility that capitalism is broken beyond repair, there is no doubt that the Government is in a very tricky place. The main argument for lifting rent caps – made by everyone from Taoiseach Micheál Martin downwards – is to encourage international investors into the market. Again, the argument is correct up to a point. If you want to get the sort of investment funds that are funding large developments here to invest more in the Republic, you have to offer them a better return than they can get from investing elsewhere in other assets. That means higher rents. The societal and political costs of lifting the rent cap have to be considered There does, however, come a point when the returns these funds are looking for are so expensive to the State that other sources of capital become more attractive. And this is where we find ourselves. The cost of getting money from these funds goes beyond allowing them to make large profits by charging high rents. The societal and political costs of lifting the rent cap have to be considered. The main one is the possibility of a political upheaval driven by the rise in prices and rent that will occur before the predicted moderation in rents kicks in, assuming it ever does. There is also the possibility of some sort of crash. The thing to remember about crashes is that most people don't see them coming, or else there would not be crashes. The Government would argue that it has other tools it can use to bring down the costs of construction, which in turn, should allow investors to get the returns they seek without a jump in prices. It may look like international investors have a gun to the Government's head. But that is always the wrong time to make a deal, particularly when you have the best part of €15bn in rainy day funds There are two problems here. The first is that progress in areas such as planning reform is just too slow and there is no real reason to believe that this will change. The second is that the world doesn't work that way. Investors will bank any savings rather than pass them on to tenants. Lifting the rent cap to encourage international investment is arguably the biggest gamble this Government will take. The potential for it to blow up in their faces is significant. It may look like international investors have a gun to the Government's head. But that is always the wrong time to make a deal, particularly when you have the best part of €15 billion sitting in rainy day funds. It's time to look out the window ... the rain is pouring down.
