Stamp duty on bulk home purchases by funds ‘absolutely’ needs to be reviewed, says O’Brien

The Government needs to look at the rate of stamp duty applicable on the bulk purchase of homes by investment funds, the Minister for Housing Darragh O’Brien has said.

Mr O’Brien told the Dáil on Thursday that the rate “absolutely” needed to be reviewed and he would discuss the matter with the Minister for Finance Michael McGrath.

Speaking during Leader’s Questions, the Fianna Fáil TD said there were 3,167 housing commencement notices issued in December, the highest ever for that month. He said this meant 32,000 homes had been started to be built over the last 12 months.

The Minister was responding to Sinn Féin’s deputy leader Pearse Doherty, who asked would the Government support his party’s motion calling for the stamp duty rate for bulk buying investors to increase from 10 per cent to 17 per cent.

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Mr Doherty referenced a housing development at Belcamp Manor in Balgriffin, north Dublin, where 85 per cent (46 out of 54) of properties in the estate were bought by an investment fund.

The Donegal TD said this was not “an isolated incident”, with investment funds “snapping up homes at an alarming rate right across the city and beyond”.

Mr Doherty said figures provided to him by the Department of Finance showed that the number of family homes bought up by such funds had increased each year, with more than 620 homes bought “from struggling homebuyers last year alone”.

“There is a Belcamp Manor being snapped up by these funds every single 30 days,” he added. “That’s what’s happening under your watch. In less than three years since this Government’s half-baked measures were introduced, over 1,200 homes have been snapped up by these funds. These are homes that should have been available for workers and families to buy, to own and to live in.”

In response, Mr O’Brien said planning law had changed in May 2021, when a stamp duty charge of 10 per cent on the multiple purchase of 10 or more residential houses was imposed.

The Minister said, in the particular case of Belcamp Manor, planning permission had been granted in 2019.

“What you’ve neglected to mention and your colleagues in all of the commentary on this, is that we have changed the law on planning and that is actually working,” he said.

“What we need to look at and what we are looking at is the rate of stamp duty applicable.”

Mr O’Brien also said since the changes had been introduced, investment fund purchases only represented less than 1 per cent of 125,000 property transactions.

He said it did anger him to see 46 homes sold in Belcamp but retrospective changes to granted planning permissions could not be made. The Minister said 40,000 homes had been protected by the owner-occupier guarantee.

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