The acquisition and management of properties by professional Real Estate Investment Trusts (REITS) is one component part of a more sustainable, long-term property rental market for both investors and tenants. While commercial property investment has been a key focus for some of the REITs launched to date in Ireland, residential property also forms part of the sector's interest and exposure. It is expected that the sector will continue to develop over time and increase the supply of professionally managed, good quality, rented accommodation.
In relation to the recent purchase of the apartments in question by an investment company, it is important to remember that the priority is to ensure an increase in the overall supply of new homes whether available to purchase or rent. Given the highlighted lack of properties available to rent in the Dublin area, increased rental supply is welcome.
Historically, the private rented sector in Ireland has been largely made up of small-scale landlords, who will continue to provide the bulk of private rented accommodation. However, a more diverse sector, which includes institutional investors specialised in providing and managing larger scale residential rental projects, provides more stability and less exposure to property market risk and volatility. Institutional investors can also help provide the range of tenancy options that households need across their lifecycles. Large-scale investment in property has an important role to play in helping to deliver the professional high-standard rental sector that tenants deserve.
The fact that institutional investors are entering the rental market, with a clear long-term focus on their investment provides security for tenants who can be confident that their landlord is committed for the long run.
A number of additional tenancy protection measures were introduced in the Planning and Development (Housing) and Residential Tenancies Act 2016 to enhance tenants’ security, including:
- The abolition of a landlord’s right, during the first 6 months of a further Part 4 tenancy, to end that tenancy for no stated ground;
- The extension of the term of Part 4 tenancies from 4 to 6 years; and
- Protection for existing tenants to remain in situ where a landlord proposes to sell 10 or more units within a single development at the same time, other than in exceptional circumstances.
These provisions apply to all apartments which are the subject of a tenancy within the meaning of the Residential Tenancies Acts.
