Dr. Mark Cassidy:

Foreign construction workers left the country when the crisis hit and we have not seen a significant return in inward migration since then. It is only since 2015 that net inward migration has turned positive, though it has turned positive at a quick rate and last year 34,000 more people came into the country than left. This alleviates labour supply constraints somewhat and construction is increasing as a result, but there are additional pressures on demand because these people need places to live. The overall effect will be positive for the sector because it will add to the net supply of housing.

I was asked about the supply of rental properties in Dublin as compared to elsewhere. A change is under way in the rental market, and in commercial property, relating to the financing of investment in the sector. Commercial investment and the buy-to-let rental sector are no longer being financed by the banking sector. Finance is now coming from equity investment and institutional investment and this has a lot of different effects, positive and negative. The positive effects include risk sharing and the long-term stability of the rental market that comes from institutional apartment ownership with longer contracts. It creates additional demand in the economy, however, for a fixed supply of housing. There has been a change in the structure of the commercial market and this affects not only commercial properties such as offices, retail and industrial, but rental apartments too. The Deputy suggested that there was more availability in Dublin than in other counties and this might partly reflect the changes too. Rents are higher in Dublin so the incentives are higher for institutional investors in Dublin. The Central Bank is looking at the impact of non-banking financing on the overall property market and we are hoping to publish more about this important research theme in the coming year.