Dr. Robert Kelly:

I have not spoken about the rent pressure zones at all, so I will outline my opinion on them before addressing the Deputy’s supply question. With regard to the current supply shortage we see, the pain is not borne equally by all households. Some people are homeowners and have been for a long time. Some people are looking to access home ownership and are paying a burden. The reality, however, is that most of the pressure we are seeing is in the rental market. Rents have risen due to the shortage. There is a real trade-off, and Dr. O’Toole articulated this really well, when we think about the calibration between protecting people in the short run from those pressures while we address the supply problem. The reality is that they do have an impact on supply. Looking at the current calibration of measures, we are in effect creating a situation in which, in real terms, rent has to fall over time for an investor. With an inflation target, as we said, at 2% as a metric, it has to mean falling real rents over time.

It is not the only factor, but apart from the inflation surge in rental costs, a lot of the factors, such as the infrastructure and all the other deficits we talk about, were there a number of years ago. Despite this, we have seen a sudden slowdown in the build-to-rent model. While there are other factors, that is one thing that has changed. There are other factors for sure, but that is a contributing factor to the attractiveness of Ireland as a build-to-rent model for institutional investors versus elsewhere in Europe and further afield.