Lifelong renting is becoming increasingly popular within Ireland’s largest cities. Influential Cork developer, Michael O’Flynn, talked about instances when he heard of people suggesting that up to 50% of houses should be rented. O’Flynn heavily disagrees with this statement and suggests that ideas such as economic and pension polices should be reviewed.
O’Flynn most recently addressed this issue during his discussion at the Institute of Professional Auctioneers and Valuers (IPAV). He set out to prove that retirees could not sustain a long period of renting properties and instead should have a house paid off to retire in. He asked the audience, “There are currently five workers for every pensioner, but the projection is for this to drop to two workers for every retiree by 2050. Have we considered how that will impact on pension income?” The renting model is not affordable for many classes of people and can cause severe economic troubles down the road when savings begin to dry up. Renting can be a great alternative for people moving to new areas or students and young adults in the workforce that are leaving temporary in an area but is not a long-term plan.
The age to receive pension funds in Ireland is going to increase into the near future and by 2028 it will have risen from 66 to 68 years old. This is why planning for your future is not certain because many factors can affect how much money you will have. Having a house and the additional equity you gain from ownership can provide a much more comfortable lifestyle.
Minister Eoghan Murphy has given his support to increasing the build-to-rent sector but fails to observe the similarities it has to the Celtic Tiger Era. O’Flynn stated, “The herd ran towards unsustainable numbers of new housing units then and is starting to run towards a model of home rental now without properly examining how this sits in our overall economic model.” A step back and thorough study and examination of the long-term effects of rentals in the Irish economy should be conducted. This could be a big turning point in Ireland and could have either positive or negative implications. O’Flynn questioned people who were encouraging long term renting, while they themselves had ownership of their homes.
The push for building rental properties needs to be slowed down and examined before a negative implication could arise out of it. O’Flynn argues greatly against the idea and the government should take him seriously.