Sign in. It’s quick, free and it’s up to you.
An account is an optional way to support the work we do. Find out more.
SOLUTIONS TO THE issue of global investment funds buying up entire estates to be placed on the rental market can be found in the tax code, Sinn Féin housing spokesperson Eoin Ó Broin has said this afternoon.
Last Sunday, the Business Post reported that Round Hill Capital and its partner SFO Capital, have just inked a deal to buy 135 of 170 houses at the Mullen Park estate in Maynooth in Co Kildare.
The two companies, both headquartered in the UK, also bought 112 homes at the Bay Meadows estate in Hollystown, Dublin 15 last month.
All 250 homes are set to be rented out, raising concerns about the already constrained supply of homes for prospective buyers.
“It’s going to have a big impact on first-time buyers. I’ve been contacted by several people who are very upset. It’s a sign of things to come,” Social Democrats co-leader Catherine Murphy told the Business Post at the weekend.
Speaking outside Leinster House today, Ó Broin told reporters, “This isn’t a new phenomenon — it’s been happening for a number of years.”
“The solutions to this are really within the tax code. These investment firms don’t pay Capital Gains Tax, they don’t pay corporation tax and they don’t pay any tax on their rent roll.
“What they’re doing is they’re going in, buying at high prices, charging high rent and then using that to flip the properties after a short period of time and to not pay any Capital Gains Tax.”
Sinn Féin, he said, would “remove those tax exemptions. They would have to pay that tax on the rent roll. They would have to pay capital gains tax. We’d also increase their stamp duty.”
Overall, Ó Broin said, “Long term, low yield institutional investors coming in and building good quality apartments to rent at reasonable prices: that’s not a problem.
“Our problem at the minute is short term, high yield vulture funds have been incentivised by government policy — tax breaks that have been in place for a decade.”
Pressure
Government politicians have also raised concerns that the demand for homes from global investors is increasing pressure on domestic buyers.
On Sunday, Fianna Fáil MEP Billy Kelleher tweeted, “If something isn’t done to tip the balance in favour of homeownership and disadvantage investment funds, we will be tenants again, like we were a hundred years ago.
“The only difference is our landlords will be investment funds based in London or New York.”
This morning, his party colleague, Minister for Housing Darragh O’Brien said he does not approve of so-called ‘cuckoo funds’ buying up estates for rental purposes.
Speaking on RTÉ Radio 1′s Morning Ireland programme, O’Brien said, “Do investors have a role in housing in Ireland? Yes, of course they do… What I would say is that where funds are coming in and taking homes away effectively from families is a concern of mine.”
However, he said he was against “banning” investment funds altogether from the residential market, which he said would be “radical” and could have major ramifications for investment in general”.
Reporting by Christina Finn
To embed this post, copy the code below on your site
Ireland is a casino for the super rich and the citizens are the gambling chips
@Gerry Ryan: In a casino you could win or lose, this is win win for big companies
@Tony Harris: the house [owners] always wins.
It ain’t right, it’s not fair.
@ConPhoto: and we keep on voting them back in.
@Joey Navinski: it’s seems no matter who we vote for they just keep rejigging themselves so we up with variations on a theme.
@Lily Martin: ff and fg are basically the same. Both represent the landlord class and the rich. I cannot fathom how any normal working person would vote for either of them. FF are not the party they once were, they are FG in everything but name. Neither of them will ever deliver the changes that are needed to improve the lives of ordinary people. Look at this latest developer lead housing plan, typical FF, it’s only going to make more profits for ffg’s developer friends at the expense of citizens. They are a disgrace.
@Welk wrangler: what’s the landlord class ? seriously I would like to know
@ConPhoto: this is not fair because of government policy, would you not want to do something about that?
@Colm Ducker: I replied to the wrong comment. Point still stands though haha
Invited in by FG with generous tax write offs. This country is a disgrace under FFG governments, a vote for either party means that our young people will never ever ever own a home.
@CASO: let’s not forget the Labour Party, they were in government at that time too. They must have agreed to it.
Listening to Billy Kelleher of Fianna Fail on the Claire Byrne show today about this issue was confusing.
He was mouthing platitudes lamenting the fact that vulture funds are pricing house-buyers out of the market by purchasing entire housing estates; but then he was making excuses about why nothing can be done to fix this, and that we shouldn’t even try.
@Cookie: That’s really the FF/FG position in a nutshell. Emphatise and agree with the public on the housing problem but then fumble, delay and shrug shoulders at the actual solution. Scapegoat the minister in the end and repeat with a “fresh” new approach when Leo takes over and a new fool to play the housing minister game for a couple of years.
FF and FG aren’t failing at housing, they’re achieving exactly what they want. Everything else is a charade. There’s zero reason or political will for a party of property owners to ever want to flood the market with supply and bring prices down.
@Rochelle: This is exactly how they “deal” with the climate destruction issue, platitudes, mumbling, fumbling, greenwash solutions and walking away – because, as with housing, they are beholden to the economic interests demanding “business as usual.” Ditto coronavirus risk to workers and minimum price of alcohol etc. etc.
I’m not a lover of Sinn Fein, I’m not sure they will do better, but the housing crisis and these investors robbing our young people of the chance of housing themselves is one reason I voted for them, not just to see if they would do anything better but to get FF/FG out to teach them a lesson on this issue alone, it makes me so angry
@Marie Agnew: is that the same SF who keep objecting to residential developments. Even O’broin objected to a social housing development in his own constituency.
@John Buckley: yes John it’s Sinn feins fault this housing crisis
@Brian Burns: he’s not saying that but it’s a fair point that they keep objecting locally. Read of another over the weekend. Not sure why, is it so they can say look FFG didn’t build them or is it simple NIMBYism?
@John Buckley: They objected to how the developments were structured. Not the developments themselves.
@John Buckley: Read O’Broins objection. Actually read it. Then read about the meeting with the locals living there who also had no objection to housing being built in the area but opposed the proposal put forward as it was badly planned and made a more sensible suggestion themselves. But it wouldnt suit your narrative to actually critically think or perhaps even read.
I’ve thrown all my deposit money into crypto in the last few years, I’ve basically had to gamble to be able to afford a house as a first-time buyer. It’s worked out well for me, but I ain’t paying capital gains tax until I have a house secured, then they can come knocking. They can take away a door with them as payment once I’m in the house. Ordinary citizens competing with vulture funds to put a roof over our heads.
@Colin: good man, you’ve worked out the system is rigged
He considers it radical to ban non resident vulture funds buying up housing estates. They’re banned in Germany from buying up residential property and Angela Merkel is no radical. But then again FFG are so right wing they probably consider her a radical.
@Ronaldo Blanc: its outrageous carry on. I wish the voters would stop voting for these lot.
The government could sell the country, and paddy would gladly rent it back.
Our Government are playing us for @&€&@ and we keep asking them back. We only have ourselves to blame.
Quel Surprise!!! not with F F and F G in charge for years now.
Leo delivering the Davos subscription model for his mates. ‘In the future nobody will own anything and will be happy’ That was the theme for the 2020 conference. It’s all for grabs, the entire Irish private property market. Entire apartments and housing estates and fully and openly enforced by Leo and FG. Great little country. God help the young trying to make a start in life.
This has been going on for years. Developer’s themselves are restricting what stock is to be sold and holding the rest as rentals. That way they control both the sale price and the rental price of their development. The frustrating thing is there’s nothing anyone can do or won’t do about it.
@tottkingham: of course there’s something that can be done about it, do what other countries such as Germany has done and ban the sale of developments to overseas investment funds.
@EillieEs: Since the GFC, when developer’s had a load of stock they couldn’t sell, they went into the rental business quite by accident to pay their loans off. Turns out it was a great investment for them and that’s how they themselves became investors. I worked on a site 2yrs ago where only 30% of the stock was been released for sale to the public. Sure, ban the overseas investors. What are you proposing for the Irish developer’s come investors?
@EillieEs: but with all the corruption going on in Ireland, they would get around that as, well!!
Remember michael noonan and enda kenny sold this country to capitalist vultures and this is the result.sad times
@reginald: and we never hear of those 2 now.. sucking their huge pensions out of the economy
We think things are bad now…Wait and see where this genius policy lands us in a few years time..
Quite recently, citizens of Belgium took a class action law suit against the Belgium government over their failure to live up to the government’s own climate action bill.
https://m.dw.com/en/belgian-citizens-sue-government-over-climate-targets/a-57018431
I think it’s high time for the citizens of this country to look at doing the same in terms of the governments housing policy & it’s complete lack of inaction to address the problem. There’s a very strong argument that our government’s housing policy is driving up prices & locking most out of the market entirely.
In the US the same is happening in terms of large investment firms buying up large portions of the housing market & is having the obvious devestating results, alos locking vast ammounts of citizens out of the housing market
How about in every new development, no one person or company is allowed buy more than, say, 10% of all the houses? That would still allow our pension funds invest in property and provide rental accommodation but avoid pricing the private citizen out of the market. Also, an annual levy on dormant land would put a stop to land hoarding, putting downward pressure on land prices. Any form of government subsidies only support higher prices.
It should be illegal to buy anymore than one home in a new housing estate
Government should be ashamed of themselves allowing this to happen
Doubt however short term high yield investment funds will hang around too long so. Ergo, the houses will be on the market at some point in future. The upside is the same funds are driving properties to be built. It could all very well go pear shape for their investments down the line.
@iohanx: In the middle of the greatest housing crisis in generations; if the government is reliant on vulture funds to build houses; then there is something fundamentally broken about our government.
@iohanx: “It could all very well go pear shape for their investments down the line.”
The Irish government will ensure that doesn’t happen.
@Cookie:
Life is not easy.
@iohanx: Forget about investors/developers and all the other leeches that are here to take as much from the average Joe and Josephine as possible. THERE IS A HOUSING CRISIS. The government need to take on building affordable and social housing with direct labour. We did it in very well the 1950′s and 60′s when the country hadn’t a bean. We can do it now. Housing has been in the hands of the private sector for years now and look where we are. I’m not trying to rule out private developers, but there needs to be both.
@Fr. Fintan Stack: where are you going to get the labour to build these houses? The young people of today are too soft to work on site so they are not taking apprenticeships. They is a huge shortage of skilled labour but the likes of you seem to think Governments should be able to magically create houses.
@John Buckley: The likes of you have your head in the sand. That’s why we are here. You offer solid full time jobs secure jobs to people to build they’ll jump at them. I worked on sites myself long enough to know job security is one of the biggest attractions to take up employment. Not bogus self employment like we have now.
@Fr. Fintan Stack: offer who full time jobs? The skilled labour is not there. You are the one with your head in the sand
@Cookie: True – when we were a poor country we they had no problem building council estates. The less property on market the higher the price- our government just gives away money to these investors, the bigger the company the less tax they have to pay. We need legislative change ASAP- foreign investors shouldn’t be able to buy housing estates. Their appreciation in a few years alone is big bucks ( and no tax)
@John Buckley: Eh, between 140 and 160,000 people currently in construction. The offer of secure jobs will attract a high proportion of them. Security not on offer in the private sector. That would also help stem the emigration issue. Make trades more attractive, etc. etc. There are a ton of reports out there that the government have largely ignored. Just Google them. The money/wages would be spent within Ireland rather than going to investment firms outside the state. Bring in workers from inside and outside the EU (again the government haven’t acted on). We pay these guys to think these issues through but for some reason they want to keep housing 100% in the private sector….. Alternatively you can just say we have no workers, shrug your shoulders and put your head back in the sand.
The only way out of the housing crisis is for gov to borrow and renovate the extensive derelict houses every town and city in the country has an abundance of. Green field building is going to cripple us as there are too many people to take a cut, landowner, construction company, vulture fund … all looking for a piece – it’s criminal what’s happening in this country.
@dottiemac: there is a reason many of the houses are derelict. People can’t live in the country and commute to work without spending huge amounts of time commuting. We have terrible rail access, terrible broadband and very few high paying jobs in rural Ireland. Building houses there now is not a solution.
@Gerard Smith: I live within commuting distance of Dublin and even 30mins beyond where I live people commute through to Dublin, lots don’t want to live in Dublin or a city. With more WFH these commuter towns are a viable option now for people and renovating houses in these towns will bring work to the town. Trades won’t have to commute and they’ll generate business where they work in shops and other businesses. For sure some people do want to live and work in cities but it will become more affordable to do so if we don’t force people to work and make a living in the city cause there’s no options elsewhere. We’re heading back to landlordism and we’ve learned nothing. We need to encourage people to stay local day and night and stop lining the pockets of vulture funds.
The government has sold the future of this country and it’s young people down the swanny, never thought I’d see us go back to modern day absentee landlords, but thats where we are unfortunately, and it will take decades to reverse this, all because of a quick buck
How was this allowed to happen.
Is there not a simple solution here, just ban overseas investment funds from buying up property in Ireland (Germany do this), and make it law that any developer building in the country has to hold a minimum percentage of their housing stock for the buyers market (say 65%).
Excellent hashtag
This statement of theirs is factual. REITs and other elements of foreign new Landlordism got extraordinary tax breaks. Ultimately it is about propping up banks.
have your say