Mr. Tom O'Brien:

The Private Residential Tenancies Board's figures show that the number of landlords has decreased from between 210,000 and 212,000 to approximately 170,000 over a period of four years. That is a fact. It is based on the Private Residential Tenancies Board's information. The total rental stock in this country is approximately 365,000 units, the vast majority of which - over 95% - are provided by landlords with one or fewer properties. The market is very fragmented. I do not believe it is possible for the State to provide a single solution to house all of those people. It is just not practically or financially feasible. I do not believe the institutional players have the appetite, capability or wherewithal to provide solutions. They are interested in concentrated blocks where capital appreciation is the primary objective. They will exit when market values recover. I know it is not popular or politically acceptable in certain quarters to say that the market will fall back to relying on the private sector to house people. I am sorry to say that it is just not financially feasible to invest in property at present. Capital repayments on borrowings are being made by people who are unable to deduct all of their interest against rent. Such people also have to pay local property tax, which is not tax deductible even though it is a direct expense of doing business. They also have to contend with increased regulation and the involvement of the Private Residential Tenancies Board. All of these issues are relevant to what is meant to be a passive investment. It is far from passive, however. It is a very hands-on business. There is nothing appealing in terms of return or effort that is encouraging the private sector in its current state.

I suggest that incentivisation needs to be brought in. I know that is not easy for certain people to hear. If we do not have incentivisation, we will not have private investment. I say that on the basis of the way the market is at the moment, even when taking current rents into account. The figures on which we are working are based on fact and have been properly costed by tax accountants. The purchase of property at current prices is not a profitable venture when account is taken of current rents and the legislative tax position. Some form of incentivisation is required. We are suggesting that measures such as Deputy O'Dowd's proposal for living-over-the-shop relief are needed. Urban or capital allowance schemes need to be directed at areas of high demand. They are urgently required in provincial town centres and city centres but not in areas where demand does not exist. I do not believe they have imposed huge costs on the Exchequer in the past. In many cases, the purchasers paid for their allowances upfront. Contrary to a great deal of the political rhetoric we have heard before now, the allowances allowed landlords not to avoid tax but to smooth out their tax bills. They paid upfront. The property prices were inflated by the value of those allowances at the outset. Landlords essentially paid for their allowances upfront.

Unfortunately, there has been significant Government intervention in the market. This has undermined confidence. We have many members. In 2011, we took a central role in a challenge to the abolition of section 23. The Government's interventionist measures have affected investors who have assumed significant debt obligations over a 20-year period. They pay upfront for their allowances and they are threatened with the removal of those allowances in one fell swoop even though they have debt underpinning those allowances and have paid for them upfront. Such measures erode confidence significantly. We are hearing from our members that this lack of confidence is significantly inhibiting investment and will continue to do so.

There has been a great deal of talk about rent control measures.

However, when considering rent increases, one must remember that rents halved in Dublin city centre between 2007 and 2014. One should also remember when reading the figure that rents have increased by 50% that this increase follows a 50% fall, which means they have only recovered by 50% of the peak.