TD claims Housing Agency has suspended payments to mortgage to rent operator

The Housing Agency has suspended payments to a private agency involved in the mortgage to rent scheme because of its failure to repair defects in hundreds of homes, it has been claimed.

People Before Profit TD Richard Boyd Barrett expressed concern in the Dáil that hundreds of people could now be living in unsafe buildings operated by Home for Life.

The private entity operates as the mortgage to rent provider for homeowners whose mortgages are unsustainable and who are at acute risk of losing their home.

Under the scheme Home for Life buys the distressed property and then leases it back for 25 years to the local authority which sublets it to the original homeowner.

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Mr Boyd Barrett told the Dáil he had received information that the Housing Agency had suspended payments and further leases to Homes for life.

Using Dáil privilege, he said he understood this was “because defects were not being remedied and repairs were not being done. It poses the question as to whether hundreds of people in Home for Life are living in unsafe buildings”.

He said that if the agency was in trouble, what would happen “to the 480 people approved for mortgage to rent to prevent the repossession of their homes and the more than 700 people in Home for Life who may have defects or problems that need to be remedied”.

He asked if the local authorities had “done the surveys they were supposed to do” to inspect houses within 90 days to ensure repairs were made.

“Certainly from the cases I have come across this was not happening. Are hundreds of people living in unsafe places,” he asked.

He said that Home for Life “essentially had cornered the market for mortgage to rent but was not willing to put in the money to remedy structural defects and other problems that may render the houses unsafe”.

The Dún Laoghaire TD said he did not expect an immediate answer but “the Minister needs to come back to me on this”.

He was speaking during a debate on a Sinn Féin motion on the remediation of defective properties constructed during the Celtic Tiger era.

Opening the debate, Sinn Féin housing spokesman Eoin Ó Broin renewed his party’s call for a levy on the profits of construction companies which receive “significant State funding” despite previous involvement in defective property construction.

Mr Ó Broin said construction company Cairn Homes was one of the most profitable companies in the State. He said its chief executive “was the director of a company that was responsible for Belmayne”, a major housing development on Dublin’s northside which has major construction defects.

“It is unconscionable that Cairn Homes is in receipt of significant State aid and planning permissions, making huge profits none of which are levied to go towards remediating properties, for example in Belmayne,” he said.

The Dublin Midwest TD also told Minister for Housing Darragh O’Brien that “there is an enormous frustration that two-and-a-half years into this Government, we still do not have a scheme” for the remediation of an estimated 100,000 properties.

“We have the promise of a scheme, the details and timeline of which we still do not know. However for families, particularly families with children, living in fire-safety defective buildings or buildings with other structural defects the wait is simply too long.”

He said homeowners, including a number who watched the debate from the Dáil visitors’ gallery, “need a scheme now”.

Mr Ó Broin expressed concern that “even if the Minister brings a Memo to Cabinet before Christmas announcing the broad outline of how he intends to proceed” it “could be well over a year or more before a scheme for these homeowners and tenants even opens let alone before they get any redress”.

He cited the length of time it was taking for the enhanced defective block scheme for the counties affected by pyrite, mica and pyrrhotite to be operational.

The Minister announced the enhanced defective block scheme a year ago, and while the legislation was passed in the summer the regulations are not expected to be ready until next year.

“We need bespoke legislation to underpin this scheme. We cannot fit a square peg in a round hole,” Mr O’Brien said as he rejected calls for the pyrite remediation board to be used.

The Minister, who is expected to bring a memo to Cabinet next week on the scheme, said he expected it to take 10 years for remediation of defective dwellings to be completed and to cost up to €2.5 billion.

Mr O’Brien said he was determined to deal with the issue “once and for all” but he said the issues involved not only the structure of the scheme, but also how it will be rolled out and how different defects are categorised. The worst affected will be remediated first.

They could not have “some type of sticking plaster approach” but it had to be done “in a deliberate and structured fashion that will be robust”, he said.