Government planning move to curb short-term rentals

O’Brien says new rules for holiday lettings close to completion

Minister for Housing Darragh O’Brien who told members of the Fine Gael parliamentary party that he would launch a ‘Housing for All’ plan. Photograph: Colin Keegan, Collins Dublin

Minister for Housing Darragh O’Brien who told members of the Fine Gael parliamentary party that he would launch a ‘Housing for All’ plan. Photograph: Colin Keegan, Collins Dublin

 

The Government is planning a new crackdown on AirBnb rentals as well as vacant homes and sites.

At the Fine Gael parliamentary party meeting this evening, the Fianna Fáil Minister for Housing Darragh O’Brien said his department is close to concluding a piece of work on how to further regulate short-term platforms like Airbnb.

Under the plans, he said, a property will not be allowed to advertise on the platform without the requisite planning permission.

At present individuals renting out a home for more than 90 days or landlords letting out a second property to tourist or others on a short-term basis must apply for planning permission either on a new or retention basis.

However, there has been criticism that the online platforms are not properly regulated.

Soaking up the rental market

Senator Tim Lombard said that Airbnb properties were “soaking up” the rental market and harming rural and urban Ireland by ensuring affordable rental properties were not available.

Fine Gael TD Fergus O’Dowd also raised the issue and pointed out that some cities like Vancouver levy extra taxes where such properties are let out short term. It is understood Mr O’Brien said he would examine this.

Mr O’Brien also told the meeting that the existing vacant sites levy is not effective and needs to be revisited. It comes after the Tánaiste Leo Varadkar told the party in a letter that a vacant homes levy may need to be introduced.

Mr O’Brien received universal praise during the Fine Gael parliamentary party, sources said. He told the meeting he will launch a new “Housing For All” plan in July which will detail county by county targets for extra properties.

He also said a new planning reform bill will later this year introduce measures for the State to recoup planning gains in new urban development zones.

Earlier Mr Varadkar said the Government may re-examine a vacant home tax and may increase the new stamp duty on bulk purchases if it does not prove effective.

In a letter to members of the Fine Gael parliamentary party, Mr Varadkar also said he thinks the Coalition we will need to re-examine the role of approved housing bodies and local authorities which will continue to be allowed to bulk-buy housing estates.

He said that the Government could “look again a vacant home tax and examine long-term lease arrangements where the asset does not revert to state or occupant at the end of the lease.”

Acting to clip the wings

He told TDs and Senators that the Government is “acting to clip the wings of investment funds when it comes to buying up houses and duplexes in our towns and cities.

“From tonight, 10% stamp duty will apply to anyone buying more than ten houses in a year anywhere in the country. This action will disincentivise ‘bulk buying’ of homes like we saw in Maynooth and Hollystown and will be effective from tonight.

“As Paschal will explain, it is open to us to raise the rate further if it turns out not be effective but it’s our judgement that it will be.

“It will still be possible for institutional investors to block buy apartments as we believe that without this form of finance, most apartment blocks simply would not be built thus resulting in reduced supply and all the consequences that arise from that - even higher prices, rents, overcrowding etc.”

He said the State needs around 35,000 new homes every year for the next ten years.

“It will cost about €120 billion to finance the construction of these 350,000 new homes. That’s much more than the bank bailout and pandemic combined. There is no way the state or public could take on that level of debt at any interest rate so we do need private developers and private finance as well as public investment.”