The Government's Housing Agency expects to buy "about 500" vacant homes from Permanent TSB for social housing. These will be the first dwellings offered by the bank for purchase by the agency since a new Government scheme began at the end of 2016.
The low returns on the scheme, however, give rise to concerns that far fewer than the 500 offered will eventually be bought and tenanted, and about how long the process may take. Of more than 2,000 repossessed homes offered to the agency for purchase using a new €70 million “revolving fund”, just 163 have been made available for social housing.
PTSB is currently facing criticisms for its decision to sell off about 18,000 “non-performing loans” in a portfolio involving 18,000 mortgaged properties to a private-equity fund or so-called vulture fund. Of the total being sold on, about 14,000 are private homes and 4,000 buy-to-lets, valued at about €3.7 billion.
Separately, the bank is also in possession of over 1,200 properties surrendered by mortgage holders under a recent incentive scheme where the bank wrote off outstanding debt in return for the keys. Most are buy-to-lets.
According to a senior PTSB source about 60 per cent of these are tenanted. The bank intends to sell these as “investment properties with the tenants remaining in situ”. The remainder will be offered to the Housing Agency.
A spokesman said the Agency was “engaging with PTSB” on these properties. “However, as the process has only begun we cannot comment publicly on specific details.”
A PTSB spokesman said the bank was “utilising a range of innovative approaches” to selling on properties where loans were not performing. Among these was engagement with authorities about selling these to the State for social housing.
Once the bank offers a tranche of such properties the agency distributes the list to local authorities and approved housing bodies (AHBs) for expressions of interest. The agency then makes bids on these, to sell them on to councils and AHBs.
Meanwhile, Fianna Fáil’s Michael McGrath, whose Bill to have so-called “vulture funds” regulated by the Central Bank is before the Dail next week, last night said Permanent TSB had declined to appear before the Oireachtas finance committee next Tuesday.
Instead, PTSB “say they will attend sometime after their annual results on Mar 14th but will be ‘constrained’” in what they can say on their sale of billions of loans.