The International Monetary Fund (IMF) has issued a caution to the Irish Government - warning that the introduction of rent controls could slow the construction of residential properties.

Speaking about the Coalition's attempts to control Ireland's volatile rental market - the institution warned that there could be negative side effects.

“Some of the gains, however, may be offset by new administrative measures to stabilise rents which, by reducing rates of return on investment properties could dissuade construction,” IMF officials warned.

Under new rent control plans landlords will only be allowed to increase rent every two years.

These comments came after the IMF's fourth post-bailout monitoring mission to Ireland.

It gives Ireland's pre-election Budget its seal of approval, saying that it "rightly share[s] the fruits of recovery."

But mission chief, Zuzana Murgasova added that spending "could be better targeted and more protective of budget resources."

"The resulting savings would create more scope for capital spending and outlays related to demographic pressures," she continued.

IMF officials described the growth which Ireland has experienced as “remarkable.”