The housing charity Threshold will today call for greater professional investment in the private rented sector.
In its report, Opportunity Knocks? Institutional Investment in the Private Rented Sector, published today, the charity calls for greater incentives to financial institutions to invest in the sector to improve standards, particularly at the lower end of the market.
The report, which is supported by the Irish Bankers Federation and the Irish Mortgage Council, points out 96 per cent of the private rented sector is owned by individuals, the majority of who own just one property. The sector is mainly managed by amateur landlords, it says. Supply is "fragmented" which has "impeded the adoption of professional management practices".
"It is highly likely that if financial institutions were to invest directly in the private sector good quality private rented accommodation would increase and good management practices would become standard.
"Yet few incentives have been put in place to promote investment by financial institutions. This is in contrast to the situation in countries such as the Netherlands, France, Sweden and to a much lesser extent, Britain."
It says financial institutions will not invest unless key conditions change. To this end Threshold is calling for the availability of reliable data on rent yields and also the establishment of a body that would act as an intermediary between potential investors and tenants.
Bodies such as this exist in the US, known as Real Estate Investment Trusts, to "make it easier for financial institutions to invest in the sector". The report calls on the Departments of Environment and Finance to explore ways of attracting institutional investment into social housing through Part V of the Planning Act.
