There is "deep concern" about the fate of 4,000 tenants in investment properties being sold as part of a multibillion euro sale of non-performing mortgages by Permanent TSB.
Campaigners say these households are “at immediate risk” of homelessness. They are calling for assurances from Government, which owns 75 per cent of the bank, that any buyer of the €3.7 billion loan portfolio gives assurances as to how it will treat tenants in investment properties or buy-to-lets.
The portfolio contains some 18,000 mortgaged properties, of which 4,000 are buy-to-lets, valued at €1 billion.
"We are deeply worried about this," said Mike Allen, director of advocacy with homeless charity Focus Ireland. "There are two aspects of it. Firstly the immediate impact and secondly, the way in which the overall position of renters is neglected."
The impact was “potentially huge”, he said. “Vulture funds are looking for short-term returns, not long-term investment. They will not be interested in long-term rental income but will want to realise the value of the asset through selling it.
“They will want the homes ‘unencumbered’ with tenants and will swiftly move to evict tenants. In these circumstances tenants only have [a] right to notice [to quit] but essentially any lease they have can be torn up. This process is the single largest cause of family homelessness and this move will make a huge number of households immediately at risk.”
He said all the political concern, after news of the massive loan sell-off emerged, had been on the 14,000 owner-occupiers.
“This concern is valid but the neglect of renters is not. Phrases like ‘investment mortgages’ and ‘buy-to-lets’ puts attention on the loan. The attention should be on the people for whom the property on which these loans are secured is their home.”
Niamh Randall, head of policy with the homeless charity Simon Communities, said it seemed to have been lost that each of the 4,000 buy-to-lets was "someone's or some family's home" and that these tenants would be "incredibly vulnerable" once taken over by a receiver or vulture fund.
It was likely whichever entity took over these buy-to-lets, they would seek to sell them or maximise the rents on them which could see current tenants evicted, she warned.
“Where do these people, families, go? Supply is at rock-bottom, rents are sky-rocketing. There’s no social housing to offer. It’s really worrying and not unreasonable to expect some kind of regulation or assurance as to how the future owners of the mortgages will proceed.”
John Mark McCafferty, chief executive of Threshold, said the tenants' rights charity had "serious concerns about the sale of 4,000 buy-to-lets".
“The tenants in these properties are facing an uncertain future. We are concerned that many of these properties will end up being repossessed . . . Tenants’ rights in relation to upkeep of the property, deposit return and adherence to the existing terms of the tenancy are often ignored when receivers are appointed or when lenders seek to repossess a mortgaged property that is being rented.”
A spokesman for Minister for Finance Pascal Donohoe said: "The rights of a tenant do not change if they happen to live in a property that is collateral in a loan that changes hands."