Tenants are out-bidding each other and it's driving rents up up 50pc, says expert
Competition between private renters for accommodation has ramped up, driving the price of renting properties up by 50pc in some cases.
That is according to Dr Lorcan Sirr, lecturer in housing and economics at DIT, who says the current system in Ireland is "not fit for purpose".
"There is a lack of supply of accommodation for people to rent," Dr Sirr told the Herald.
"Landlords don't really set the price. Tenants are out-bidding each other for the price.
"Under the legislation we have in Ireland, rent can be increased to the market level, which is being pushed up by 30, 40 or 50pc.
"It is unaffordable for people and causes them to move away to other places and you hear of kids going to stay with their granny, etc."
Dr Sirr says there is not enough being done for renters compared to the provisions in place for homebuyers.
"We are happy to control affordability for people in the home ownership category," he said. "But we won't do it in the rental sector, which is wrong.
"People don't really have security of tenure for what I would call spurious reasons, like the landlord needing the place back for themselves or for a family member."
Dr Sirr says the Government should introduce more measures for the private rented market. "Rent certainty is a very good thing and there is enough extensive and detailed research from the OECD and the National Economic and Social Council to show it is good in any civilised society," he said.
"Rent certainty should be linked to the Consumer Price Index for a period of five years.
"The first thing I would do is provide 100pc mortgage interest relief for landlords. The system we have at the moment is not fit for purpose."
Opposition parties have called for the Government to increase housing supply and introduce more measures to help those in the rented market.
"We have seen an increase in rents since 2012 in particular, and five times the amount of homelessness," said Fianna Fail housing spokesperson Michael Kitt. "People renting and on rent supplement are not able to pay to live where they want and they are being pushed further and further away.
"The main issue is there needs to be more housing built and we would be in agreement with the ESRI that 25,000 houses need to be built per year. We would back that very strongly.
"There is money available through local authorities for housing which isn't being used.
"There are 2,600 local authority houses empty and I know that a number of homeless groups have been asking for them to be refurbished and used. There was talk of Nama properties being available for housing, which didn't happen.
"We want to build 150,000 houses by 2021, which is a long way away but we have to start somewhere."
Fianna Fail has been calling on the Government to bring in a rise in rent supplement.
"The Government's refusal to increase rent supplement is causing huge problems, and we have told the Government that rent supplement is an anti-poverty measure," Deputy Kitt said.
Sinn Fein housing spokesperson Dessie Ellis is also of the view that rent supplement needs to be increased.
"We have said all along that if the Government is going to increase rent regulation, there needs to be an increase in rent supplement and then bring in rent controls tied to the Consumer Price Index or the rate of inflation", he said.
"The amount of places available at the moment is very little. Building has gone down. There is not enough private or social housing after the crisis.
"Anyone trying to buy a place at the moment needs a huge deposit and that's a drawback. Only people who are reasonably well off can afford to buy a place
"We don't have stock out there for people. We have seen an increased in price and an increase in the amount of people looking for housing.
"It's of major concern to us because we have 130,000 on social housing list and we just say build more social housing
"We are facing a huge crisis unless we can steady the ship in terms of rent supplement.
"The problem is going to get worse with the amount of people in mortgage distress and who are two to three years in arrears."
But Ireland's love affair with property is not going anywhere. Demand for rental properties is just as high as property to purchase.
Figures from the Banking and Payments Federation Ireland found there were 2,709 mortgage approvals in the three months ending August this year - a rise of 5.2pc within the year.
But with a lack of supply, these would-be homebuyers may ultimately be forced back into the rental market, continuing the vicious cycle in perpetuity.