A Government proposal that would allow the owners of modular homes to rent them out tax free has been described as “really smart”, by one housing expert. 

Currently under the Tenant In Situ scheme, anyone can rent a room or rooms in their main home out and earn up to €14,000 tax free from the arrangement. 

The Department of Housing is drawing up legislation that will allow modular homes to be erected without planning permission. Once passed, the Tenant In Situ scheme will likely be extended to those who rent out a modular home. 

The proposal has provoked ire from opposition parties, with Labour TD Conor Sheehan arguing that “beds in sheds were not a solution to the housing crisis”. 

“It seems now, despite their earlier protestations, that Fine Gael and Fianna Fáil now think it is acceptable for renters and students to sleep in a shed beside the lawnmower,” he said. 

However, on Newstalk Breakfast, Property District CEO Carol Tallon predicted the move would ease the housing crisis. 

“I think genuinely we have to welcome this as a very positive step,” she argued. 

“The EU only last month formalised escalating the housing crisis across EU member states to a social emergency. 

“So actually, we have to get to grips with this as an emergency - we are in an emergency situation.” 

Ms Tallon continued that while she is “generally not here to defend the government in any way” over its handling of the housing crisis, she believes the new policy is “really smart”. 

“They're actually coming in with something that can supply, that can target supply at speed, they can actually activate underused land use,” she added. 

“And it's familiar by putting it within the rent-a-room scheme, they're taking away any debate as to whether this could be abused by commercial landlords. 

“And by giving that familiarity of the rent-a-room scheme, people know what they're doing.”

Main image: A man assembling a modular home. Picture by: Alamy.com.