State was in dark about institutional investors buying up housing estates

New homes bought by non-private individuals almost doubled between 2017 and 2020

New homes at Mullen Park, Maynooth, Co Kildare. Photograph: Dara Mac Dónaill

New homes at Mullen Park, Maynooth, Co Kildare. Photograph: Dara Mac Dónaill


Very limited data was available to Government on how many, or which, institutional investors were buying up finished housing estates and apartment blocks in bulk.

According to internal emails, the primary purchasers – “anecdotally” – tended to be large European and international pension funds either through direct sale or providing funding for property deals.

The emails said investment funds tended to be more active at an earlier stage for the original purchase of land or the funding of construction.

An email from a Department of Finance official said: “While there is CSO [Central Statistics Office] data on purchases by institutions, it does not provide any real colour around the specific type of institution purchasing in the market.”

It said there was “limited data” available outside of what was being provided in research from the private sector.

The details are contained among records from the Department of Housing as it grappled with controversies over the purchase of property by institutional investors and later the fallout from the sale of most of the 170-home Mullen Park estate in Maynooth, Co Kildare, to one company.

An internal note said the number of new homes purchased by non-private individuals – including local authorities and approved housing bodies – had almost doubled between 2017 and 2020 from 2,090 to 4,132 per year.

It said, in 2019, about 23 per cent of non-private purchases of any home (including new ones) – or 3,054 purchases – had come from the financial and insurance sector, including banks, holding companies, trusts and funds.

Another 16 per cent – involving 2,078 purchases of any home – were by real estate management companies, and other companies buying, selling, renting or operating their own properties.

The note also said non-private individuals sold more properties than they bought and had done every year since that type of record was first kept in 2010.

Further legislation

Internal briefings following the purchase of most of the estate at Maynooth detail how government measures to tackle institutional buyers would be targeted primarily at lower density housing estate type developments where “viability should not be an issue”.

It said it would ensure institutional purchasers could not buy up homes where there was clear demand by owner-occupiers.

The briefing said: “Provision is made that if no market emerges, the developer can apply to the local authority, and they can discharge the condition if they are satisfied that the houses have been made available on the market for a year.”

It added that the Attorney General had advised further legislation might be required to “bolster this provision”, though the department believed it possible they had sufficient powers already.

The briefing said access to new homes by first-time buyers was a key part of the housing market, which was generally split 1:3 between new homes and second-hand home purchasers.

It said: “Mobility within the market is important for first-time buyers, particularly as they gain access to homes through movement of other owner-occupiers trading up or downsizing.”

Another briefing paper said the “key message” should be that the government supports home ownership and is “taking firm action to protect traditional family homes from bulk purchases”.

The paper, titled “Protecting traditional family homes and maintaining supply”, said a key objective would be to level the playing pitch with institutional investors.

Planning changes

The briefing said a second key objective would be “ensuring that bulk purchases of low to medium density traditional family homes where viability and demand are not significant impediments are prevented”.

It said, however, institutional investment in higher-density developments would be maintained and encouraged where “viability is an issue”.

The briefing said planning permission changes could not be made retrospectively as this “would risk legal challenge”, so increases in stamp duty would be pursued instead.

The records also detail changes made to a statement intended for Minister for Housing Darragh O’Brien to deliver in response to questions in the Dáil.

A draft opening statement said the housing estate in Maynooth “should have been sold for home ownership”.

However, in a later version this was changed to properties “that might otherwise have been sold to ordinary families”.