On Tuesday, the Cabinet approved an outline of new rental rules which are due to replace the current arrangements for tenants and landlords at the end of the year.
The Coalition has yet to publish legislation which must be voted through the Oireachtas. Expect parliamentary fireworks as Opposition parties fight the measures and accuse the Coalition of caving into foreign property funds.
Make no mistake - this will be a radical overhaul of existing arrangements with the intention of luring investors back to the market.
This is what the changes will mean - from March next year when a tenant leaves a property the landlord can set the rent at the market rate.
That is a huge change from existing arrangements where the rent increase is limited to the rate of inflation or 2%, whichever is lower, regardless of whether there is a change of tenants.
The danger is that landlords will have a financial incentive to evict from March. If that happens, homelessness figures could suddenly rise and average rents could rocket too.
In fairness to the Government, it is also tightening the grounds landlords can use to ask tenants to leave.
Renters will also benefit significantly with the introduction of six-year tenancies running from March next year until 2032.
Landlords with fewer than three properties will no longer be able to use selling a property as an excuse to evict, as they can at present.
Another huge change will come in 2032, when landlords will be able to reset rent to the market rate.
This is going to be enormously controversial. If a tenant is renting a property for €1,500 monthly and the market rate is €3,000 the landlord will now be able to reset to the higher rate for an existing renter.
Between now and 2032 there will be a general election. Opposition parties could promise voters they would remove the ability of landlords to reset rents in 2032.
If that happens, it would be another major policy shift potentially discouraging investors already exasperated with years of chopping and changing.
Housing Plan
This week, RTÉ reported some details of the Government's long-awaited housing plan.
Among the proposals is an emphasis on encouraging councils to use compulsory purchase orders to return up to 20,000 vacant units back to use.
Sinn Féin's housing spokesman Eoin Ó Broin says without changes recommended by the Law Reform Commission, compulsory acquisition remains a tricky option for councils.
That is particularly the case where ownership of a derelict property remains uncertain.
The draft Housing Plan envisages putting huge sums of money into schemes to aid people to buy houses.
One of them is Help to Buy, which has been popular because it allows homebuyers to reclaim up to €30,000 in income tax paid in the past from the Revenue Commissioners and use it towards a deposit.
Another is the First Homes scheme where the State takes a stake of up to 30% in a home to help people bridge the gap when purchasing.
The problem with both incentives is that economists argue they have simply added to rocketing house price inflation by giving buyers more money and have done little to help with the supply of new homes.
However, the building industry has argued the incentives have encouraged construction.
The last Housing Plan included targets for the number of homes to be built annually, which were missed last year and are likely to be missed this year too.
There is currently discussion among Ministers about the merits of including targets in the next plan, although the Programme for Government includes a commitment to build 300,000 homes over the lifetime of the Coalition.
Targets don’t build houses. But they do show whether the Government is achieving its aims.
The latest indications for the future pipeline are not encouraging.
Planning permission figures from the Central Statistics Office showed a 12.5% drop in approvals with a massive 35% fall in Dublin alone over the past year.
At the annual conference of the Construction Industry Federation last month Ger Ronayne, the chief executive of building company JJ Rhatigan, said his company was now seeking projects in the UK because of a decline in activity in Ireland.
VAT
Part of the problem is an alarming 24% collapse in apartment building last year.
The Government slashed the rate of VAT from 13.5% to 9% on the sale of apartments last week in the Budget to try to address that.
It is a massively expensive measure costing €690m in 2027.
Dr Michael Byrne, lecturer in political economy in UCD, said: "I fail to see how the VAT changes and rent changes won't result in more supply."
But he argues many of the measures included in the Housing Plan reported so far could end up adding to property prices and "have inflationary written all over them".
Next Thursday, the Central Statistics Office will publish house completion data for the third quarter of this year.
The Economic and Social Research Institute predicts there will be 35,000 homes built this year.
To meet the housing shortfall, annual output needs to be more than 50,000 per annum before rapidly increasing. It is nowhere near that now.
