Tax reliefs aimed at making rented accommodation more accessible to low-income families have been recommended in the Bacon report.
It also proposes a review of landlord-tenancy legislation by the Law Reform Commission, which would focus on barriers to investment and an appropriate balance in tenure rights.
The current tax allowance for those aged 55 and under in rented accommodation is applied at the standard rate and amounts to £500 per year for a single person, £750 for the widowed, and £1,000 for a married person.
For those aged over 55, the allowance amounts to £1,000 for a single person, £1,500 for the widowed and £2,000 for a married person, and is applied at the marginal rate.
The second Bacon report has recommended that this threshold should be "revised to reflect broadly the recent trend in rents across the country."
In other countries the resources of the voluntary sector have been harnessed effectively to help provide accommodation to poorer groups in society, but in Ireland this is underdeveloped, it says.
It recommends that, on a pilot basis, the Minister for the Environment and Local Government should invite proposals from the voluntary sector as to how their resources could be applied more beneficially. This could include the refurbishment of dilapidated buildings into residential accommodation.
Rents have been rising rapidly in line with house prices, according to the most recent survey of the Irish Auctioneers and Valuers Institute.
In the 12 months to November 1st, 1998, rents in Dublin rose by 24 per cent, with increases of 17 per cent in the rest of Leinster and Munster and 12.5 per cent in Connacht.
In good locations in Dublin, the monthly rent of a modern two-bedroom apartment rose on average from £670 per month in 1997 to £810 in 1998, representing a 20.1 per cent increase. A modern three-bedroom semi-detached house rose in rental value from £770 per month in 1997 to £880 in 1998, representing a 14.3 per cent increase.
Rents of older houses in good locations in the capital also saw growth, with a one-bedroom flat increasing by 15.7 per cent between 1997 and 1998 to £480 per month, according to the Institute of Professional Auctioneers and Valuers. An IAVI survey showed that the fastest increase in rents occurred in Dublin, averaging 8.7 per cent between January and July last year. The biggest increase was 13 per cent in the £400 to £600 per month bracket.
The greater take-up of rent supplementation also reflects the increase in the demand for private rented accommodation. Expenditure under the Supplementary Welfare Allowance has risen from £14.4 million in 1991 to £76.3 million in 1997 and an estimated £88 million for 1998.