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IF LANDLORDS GET tax breaks in September’s Budget, renters should also get concessions too, according to Tánaiste Leo Varadkar.
His comments come on the back of the most recent Daft.ie report which finds that Ireland’s rental market has dropped to new depths as the number of homes available has dropped to an all-time low while the rate of inflation in prices climbed to its highest level in at least 15 years.
The property search website’s latest rental report finds that rents in the second quarter of this year climbed to an average of 12.6% higher than the same period of 2021.
This dramatic spike is the biggest increase recorded by Daft since it began carrying out its reports in 2006 and it came as the availability of rental homes dropped to an all-time low. The average market rent across Ireland between April and June was €1,618 per month.
Varadkar said the answer to solving the rental crisis is more supply, the continuation of the rent pressure zones which caps rent increases at 2%, as well as measures to “reduce the speed at which landlords are leaving the sector”.
“I know it may not be popular to say, but the truth is more and more landlords everyday are just selling up and have decided it’s easier to sell their property than to continue to rent it and we just need to reflect on that and see what we can do to improve things,” he said.
Tax breaks
In relation to tax breaks for landlords, Varadkar said:
“I do think that if there are any significant income tax or tax concessions for landlords in the budget, well there should be for renters as well,” he said.
“It wouldn’t be fair to say that we’re going to give tax concessions to landlords, in order to keep them renting, which would be a good thing, but then to say to renters ‘well there’s nothing in it for you’ – that wouldn’t be fair,” he said.
The Tánaiste added that proposals have not been worked out or agreed in relation to the budget, adding that the three coalition party leaders have discussed nothing specific at this stage.
However, Varadkar said introducing some tax changes in the budget to encourage landlords to stay renting and stay in the market is a “good idea”.
The idea of tax breaks for landlords to keep them in the market was floated by Housing Minister Darragh O’Brien in May, where he told the Dáil that in order to retain individual landlords in the system, it “may require tax measures”.
Tax percentage
At the time, he asked Sinn Féin’s housing spokesperson Eoin Ó Broin if he would support such a measure.
When pressed on the issue today on RTÉ’s News at One today, Ó Broin said he was yet to be convinced by the proposal, but said that he was willing to sit down with all stakeholders, including those representing landlords, to find out what percentage of tax would keep them in the market. He stated no specific tax percentage proposal had been submitted from the sector.
When asked if there was a way to ensure that tax breaks for landlords could be passed on to renters in some form, Varadkar said today that he believed such a measure would be difficult to administer.
“And that’s actually really important when it comes to tax and welfare that whatever you do, is actually possible and efficient to administer. There are different things you could do. But I think if you had a tax break for landlords, and that was conditional on them passing on some of that to renter, I’d be concerned that wouldn’t work. But the objective should be that if we do anything in the tax base to help landlords well something has to be done for renters as well,” he said.
Varadkar said the Government “very much appreciates this is that it is very hard to find somewhere to rent and rent in Ireland are very high”.
The Government is working to increase the supply of cost-rental properties, said Varadkar, who added that they are coming on stream now.
Note: Journal Media Ltd has shareholders in common with Daft.ie publisher Distilled Media Group.
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Electioneering from the spoofer.
@Eddie O’Neill: How many years do FG need to get this right? Haven’t they had decades of practice?
@Frank Cauldhame: the problem is they don’t want to get it right.
I see the journal is now closing comments on sports articles!!
@Mike Finnegan: nobody reads your comments anyway Mike.
@Johnny: ah well, Johnny , I’ll always have you….
@Mike Finnegan: be whoever you want to be. No problem with that at all – your choice and I respect that. But there are genuine safety concerns and physical advantages for trans women playing in women’s rugby. Don’t see the need for outrage from elements of the trans community at all.
The big elephant in the room which all the politicians steer well clear of is, and it’s not paying their fair share of tax, it’s that landlords have no protection against non paying tenants. If non payers could be shifted quickly and not taking 2 years get them moved and if a fast track system was introduced, ie. max 3 months then an awful lot would stay in the business. Most landlords I.ve spoken to don’t really want to sell but are afraid of being caught with a wrong tenant and suffer huge losses and stress.
@Paddy Griffin: Exactly. Landlords don’t need tax breaks. Rents have been rising. Landlords need security of their property, as in non-payers of rent can be removed in 3 months
@Mickety Dee: appreciate that’s a big issue, reform needed on this. It would be interesting to see the percentage of landlords where this is a concern and also the actual number of tenants who are not paying across the country. With our stars it’s hard/unfair to make this argument, however right it maybe.
Only renters should get tax breaks
@JustBEERbarry: which will have no impact on the supply of properties for rent
@JustBEERbarry: i was an accidental landlord. Was a nightmare and I couldn’t wait until the property prices rise enough to pay off the mortgage. I was making a loss every year and had a nightmare tenant. Was very stressful. A few of my friends had rented properties and sold as soon as they could.
@Billybutcher: the supply chain is being drip fed and manipulated by developers and REITs. Why invest millions to double size of market to get half of current rents. They limit the increase to keep rents high.
@M Bowe: The same argument all leftists use to explain scarcity brought about by government interference. In Venezuela, that’s the argument the Gov there use to explain food shortages. In reality, the Gov has set the price so low for food that it costs more to produce it than it can sell for. You take attitude and I can guarantee the problem will continue to get a lot worse
@Brian Madden: How do you become an “accidental landlord” ?
@Brian Madden: had the exact same experience, annual loss, nightmare tenants and stress +++. Would love a poll on how many have sold up and exited the rental market.
@Ryan: having to rent out your home to pay the mortgage
@Ryan: Emigrating because you lost your job here, can’t get another job… can’t sell as selling price is less than the mortgage you owe, so have no choice but to become a landlord. This was 10 years ago….sold as soon as the price went up enough to repay the mortgage.
Why would Landlords want to stay in the market. With rising house prices at present and with the Govt ensuring that demand is way above supply, landlords are doing what anyone would do and cashing in to make a maximum profit. Any given tax incentives will have to outstrip the increase in house valuations to stop them exiting. If, as promised, supply begins to catch up with demand, then the price of houses will devalue and the profit margins won’t be as big. Hundreds of millions are spent each year on rent allowances and yet millions are owed by those not paying their rent. Excluding the vulnerable, why is this being tolerated. Effectively all that does is take millions from areas such as health and housing. The strategy has to change and if that means e.g. building 1/2 bedroom houses, in the same area for people who are now living alone in 3/4 in bedroom houses in that same area
@Barrycelona: Spot on. The “home for life” social housing model needs to be done away with.
Leo must have joined SF.
@Paul Power: Yep. As you know only SF have the magic money tree
@Shaun Gallagher: Same as FF and FG have had over past few years. Borrowing money left right and centre
@Shaun Gallagher: FFG managed to pick the magic money tree recently to tune of €400,000,000 for military to buy an independant vote on no confidence motion!
Can the government not just buy the houses landlords are selling and rent them out to people, isn’t that the business the councils are in,
@Gerard Mooney: and where exactly would that money come from? Look at the state of the current council housing stock and the arrear rates. The state is the only entity that can break their own regulations and get away with it.
Give very significant tax break for private landlords (not REITS) who sign up for long term leases thus giving renters peace of mind
@dublindamo: love it, like in Germany! Also cap rent rise everywhere to inflation (though currently that’s maybe a bad idea) at least this way you know and can plan ahead, for both tenants and landlords.
Christ! I’m a landlord. Just cap rents. Have maximum amount allowed on 1 bed, 2 bed etc.
How long have FG had in power? How long have FF propped up FG in power ? Listening to Leo the spoofer you’d think these are light bulb moments he’s having… they created the mess we are in…. why do they act like its nothing to do with them ?
from the very party leader that continued the policy of inviting property development and asset management companies/vulture funds.. bring back the guillotine
I’m confused, if landlords are selling up, surely this means more people are then buying a house, who would have previously rented? It’s not like when a landlord sells the house vanishes. So what’s the problem (other than not enough houses being sold). Surely then the time is now for the state to be the one developing houses and not encouraging individual landlords or large vulture funds to be building! Isn’t this a chance to rebuild the housing sector, one that’s not reliant on the nonsense that the ‘market’ will always provide the answer? 2/5ths of Danes live in social housing (not free houses for lazy People before the usual bridage pipe up)
Time for some rethinking and let’s not go back to the same old rubbish
FG supporting landlords nothing new there. Landlords using the tenant from hell stories to get sympathy, nothing new there.
As my Dad used to say about gambling “Did you ever seer a Bookie on a bicycle”
Exactly the same with landlords. My last private landlords all drove very expensive cars and when the rent book had to have their home address on them, I saw their homes and they were all big and fancy.
The system I prefer is The Vienna System of Housing, check it out. It works and makes money.
So spare me the poor landlord BS, I spent 30 years making them wealthy.
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