The body that represents landlords says incentives are urgently needed to keep them on the rental market.
It follows last week’s data release that showed 40% of residential property sales during the last three months of last year involved homeowners exiting the market.
The Irish Property Owners Association (IPOA) said unsustainable taxes and overly onerous regulations are forcing tenants to sell their rented properties.
He said the findings of the Society of Chartered Surveyors of Ireland report, published on Friday, were alarming but not surprising as it has been highlighting the problem to the Government for years.
“SCSI’s findings should be sobering reading for those who argue that we can achieve a sustainable rental market only by increasing the regulatory burden on the sector,” said IPOA President Mary Conway.
“We welcome An Taoiseach’s indication that it aims to introduce new incentives for owners, but these must be meaningful and not cosmetic, if it is to address the exodus of private owners from the market.”
Last week, Varadkar said that tax measures to encourage more housing construction and keep homeowners in the rental market are not “off the table.”
“These latest figures underscore the need for a fundamental rebalancing of the approach to this policy issue, rather than continuing with small tweaks to the system, which only incentivize homeowners to sell,” said Ms Conway.
“Therefore, a reduction in the tax on the rental income of private landlords with a commensurate increase in the rate paid by institutional investors in residential property will achieve an outcome that will prevent further housing supply lock-ins.”
Last year, research by the IPOA and the Institute of Professional Auctioneers and Appraisers found that 57% of property owners with properties in Rent Pressure Zones (RPZs) planned to sell their property.
Some measures were introduced in the budget to help owners, but the IPOA described them as minuscule.
He said the government now needs to act “boldly and urgently” to create the right incentives for homeowners to stay on the market.