Dr. Michael Byrne:

It is a complex question. My reading of the international view is that it is almost the opposite - tax incentives risk skewing the property system in ways that are detrimental to tenants in particular. That is not inevitably the case but they present that risk. A good example of that is in the United Kingdom, where the level of investment from small-scale landlords has been much more sustained than it has in Ireland and the buy-to-let mortgage segment has continued to grow, unlike in Ireland where it collapsed after the crisis. The danger is that when one does that, it is a demand subsidy. One is subsidising investment demand. What that does, especially in a supply constraint context such as the one Ireland is currently experiencing, is to push up asset prices - house prices - and create a situation in which landlords are in a better position to outbid would-be first-time buyers, for example. Obviously, if a landlord is paying less tax on his or her income than a first-time buyer is paying, that creates an issue. We need to consider how subsidies for landlords interact with other aspects of the housing system.

We need to ask the bigger question as to what proportion of our housing stock do we want to be in the private rental sector. It is currently a quarter of houses in Dublin. Do we want that to be a third? Do we want it to be 50% of people renting? I do not see a huge demand for that to happen. That is the trade-off there. More targeted measures, where tax incentives are used in a way that requires landlords to provide security of tenure, have not to my knowledge been implemented, at least in the countries I look at, namely, the US, the UK, Spain, Australia in New Zealand.