The rent freeze being advocated by some political parties in the general election would negatively affect housing supply, Goodbody Stockbrokers has said.
A research note released by the broker suggests that a three-year rent freeze applied to all tenancies would “most likely result in a decline in supply”.
The Labour Party and Sinn Féin have both committed to freezing rents along these lines, although Fianna Fáil has backed away from previous commitments to introduce the measure, citing concerns over its constitutionality.
According to the Goodbody note, the prospect of a rent freeze knocked 20 per cent off the value of Ires, the State’s largest institutional landlord, when it was first floated.
“Rent regulations can create larger shortages on rented property in the longer term as investors/funders will see less attractive returns,” Goodbody said.
The broker added that rent freezes would not address the fundamental problem in the Irish market, which
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