O’Brien ‘hopeful’ housing proposal on funds will go to Cabinet next week
Inhibiting housing associations, local authorities has to be guarded against, Minister says
Darragh O’Brien said he and Minister for Finance Paschal Donohoe will be working on proposals over the weekend. Photograph: Tom Honan
Minister for Housing Darragh O’Brien said he is “hopeful” there will be proposals to restrict institutional investment in the housing market brought to Cabinet next Tuesday.
The Coalition has been under sustained pressure over the issue since it emerged an investment fund was purchasing the majority of units in an estate in Maynooth, Co Kildare, with first-time buyers unable to bid on the homes.
“We’ll be working through it over the weekend, waiting for some legal advices back, but I’m hopeful we’ll be able to bring proposals to Cabinet at some stage during Tuesday, to be implemented very shortly thereafter.”
He said that changing regulations around the capacity to bulk-purchase in areas with certain populations was an area under consideration. So was reserving a percentage of units for first-time buyers and “designation and other areas in planning”. He said, however, the Government would be aware of unintended consequences.
While the focus would be to “make sure we don’t have big funds actually hoovering up family homes”, he said inhibiting housing associations, local authorities or the Land Development Agency would have to be guarded against.
“What I want is a level playing pitch for first-time buyers, so the measures we bring forward next week are carefully calibrated to make sure they are. They require Cabinet approval, but also to ensure that there’s no unintended consequences to them as well”.
He said Ireland also had a “shrunken market” of financial services operators to lend in support of development, and that international investment would be required to fund housebuilding.
“I’m confident what I bring forward on Tuesday from the planning side will have an impact, but that has to be complemented from the planning side. And Paschal has been working away on that assiduously, and we’re in contact every day on that at the moment.”
He said he expected measures to be implemented in a “very short space of time” after they were approved.
“I’m bringing forward affordability measures that are going to make a difference for people and are going to mean this year that people are going to be able to buy affordable homes, and rent affordable homes for the first time in well over a decade.
“While we’re doing that we can’t on the other side have those very same people competing with large funds.”
He was speaking at the turning of the sod on an affordable housing scheme being developed by Fingal County Council in concert with the Ó Cualann Housing Alliance. Construction on 39 affordable homes and 12 social homes at the project will commence in the coming weeks. The prices for the homes will range from €166,000 for two-bedroom apartments to €258,000 for three-bedroom semi-detached homes.
Mr O’Brien also said he would be bringing forward new legislation during the autumn on renting, with rent pressure zone legislation expiring this year.
“There’s a good opportunity to bring about a more stable environment for tenants and indeed for the more mom and pop landlords that are out there as well.”
He said the 4 per cent annual increase in rents permitted under the rent pressure legislation had “become the target”.
“A 4 per cent annual increase is a significant increase. I want to have a look and I’m looking at what’s done in other parts of Europe, and in continental Europe with regard to what types of rent increases would be acceptable, and what would be manageable.”