10th October 2023
- The IPOA acknowledges that the 20% tax relief on rental income introduced in Budget 2024 for the sector is a positive step in the right direction, but tying the supports to security of tenure leaves landlords with their “hands bound”.
- The Minister for Finance announced in today’s Budget that he is introducing a temporary 20 per cent tax relief on a portion of rental income for landlords which will disregard income of €3,000 for 2024, €4,000 for 2025, €5,000 for 2026 and 2027, so long as landlords remain in the market for a four-year period.
- Linking supports to “security of tenure” fails to recognise the significant threat to the value of property assets.
- Should property owners be required to agree to four-year tenancies up front the possibility of being trapped in the rental market at a real risk of investment depreciation may discourage take-up of the scheme.
- The measures introduced threaten to repeat past mistakes associated with such incentives and will do little to stem the flow of landlords, leaving the market because of the fear of further interference in their property rights in the years ahead. Landlords operate in an increasingly complex legislative landscape which is rife with uncertainty and presents a challenge for landlords to navigate.
- In 2015, the state introduced a 100% mortgage interest relief for investors who entered three-year fixed-term tenancies with social housing recipients. Unfortunately, this initiative saw negligible uptake and did not yield the desired results, as the scheme failed to work for property-owners which had a clear impact on the availability of tenancies.
- All in all, the terms and conditions of being a landlord in Ireland is not conducive to creating a thriving private rental sector. Investors need confidence and stability. However, the current market fails to offer these assurances.
- Should the government wish to impactfully address the issues with supply in the private rental market, providing adequate relief measures for landlords equally, rather than contingent on a fixed-term tenancy basis, is crucial.
- Once again, the Government has failed to address the inequality in tax treatment in the rental market between RIETs and small landlords. If the imbalance was addressed, this would have had a positive impact on the supply of rental accommodation.
- As an Association, we fear that with the budgetary measures introduced today, the Government will fail to stem the number of landlords leaving the rental market, and as a consequence there will be little reprieve for those seeking rental accommodation in an already squeezed market.
IPOA SUPPORTING LANDLORDS FOR OVER 30 YEARS
CONTACT US 01-8276000 / email@example.com