Proposals to address funds buying up homes not yet ready for Cabinet

Firms owned 5 per cent of rental properties at the end of 2020

Minister for Housing Darragh O’Brien said he hoped to finalise details of a proposal this week on how to respond to investment firms buying up new build houses and apartments.  Photograph: Tom Honan/The Irish Times.

Minister for Housing Darragh O’Brien said he hoped to finalise details of a proposal this week on how to respond to investment firms buying up new build houses and apartments. Photograph: Tom Honan/The Irish Times.

 

Minister for Housing Darragh O’Brien has said he and Minister for Finance Paschal Donohoe would not be in a position to present options on proposed changes to planning and tax laws to the Government at Tuesday’s Cabinet meeting.

He said work on the options available to the Government would not be finalised until later in the week.

Mr O’Brien said on Monday while the percentage share of housing being acquired by so-called cuckoo funds was still relatively small, it was growing. 

About one per cent of the total housing stock is now controlled by private investment funds, he confirmed.  

According to the commercial property agent, CBRE, the total number of residential units under institutional ownership in Ireland was over 15,500 at the end of 2020.

This equates to less than one percent of the total housing stock in Ireland and comprises approximately 5 per cent of all rental tenancies. The vast majority of the residences are apartments.

More recently, however, investments firms have begun to bulk buy new-built houses in suburban residential developments which would have been targeted primarily by first-time, and family-home, buyers. Several such acquisitions have been reported by the media in recent weeks.

Addressing the phenomenon of investment firms buying up large numbers of new build houses on suburban estates, Mr O’Brien said: “I have been very clear on this. I spoke on this before the situation in Maynooth arose (where a fund bought the majority of a 177-house development for the private rental market). We want a level playing pitch for potential home-owners and first-time buyers,” he said. 

“We don’t want a situation where family homes are being purchased in bulk.”

Mr O’Brien said he was looking at planning measures, including the reintroduction of a private members’ Bill he tabled in late 2019, that reserved 30 per cent of all new developments to first-time buyers. 

“We are also working with Minister for Finance Paschal Donohoe to see what options we can bring forward this week. 

“I don’t expect those options tomorrow (Tuesday). We know this is important. I know how people fell. We need to resolve it but must ensure that the measures we bring forward are doable and will have a positive impact to make sure that first-time buyers are not competing with large investment funds. 

That is not a situation that anyone can stand over,” he said. 

He said that work had been ongoing on this issue over the weekend but was not yet complete.