Michael Staines
Michael Staines

12.13 6 May 2021


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The Housing Minister says he is considering a range of measures to tackle cuckoo funds – up to and including banning them from buying residential property.

IN an exclusive interview with Newstalk Political Correspondent Seán Defoe Darragh O’Brien said he expects proposals to be brought forward next week to stop investment funds from buying up entire housing estates.

It comes after two UK investment funds snapped up almost all the homes in two housing estates in Dublin and Kildare with plans to rent them out to Irish families.

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Minister O’Brien noted that Department of Finance has the power to “affect real change” on the issue by cutting back on the tax breaks currently offered to the funds.

He said he needs the support of the Finance Minister to tackle the issue but insisted he is “not writing anything off” at this point.

“What I want is something that is sustainable, legal and effective,” he said. “We have a constrained market already because of COVID and the idea that, in a housing market where we are going to have maybe between 14,000 to 16,000 homes completed this year, that we can have funds coming in buying up family homes from under the noses of first-time buyers is unacceptable.

“So, whatever measures are needed to take place, up to and including a ban, I am open to looking at.

“I am just waiting for those options to come back.”

Minister O’Brien said the tax breaks that are currently in place were brought in by the previous Government back in 2013 – but said he has had no “resistance or difficulty” from Fine Gael in his attempts to tackle the issue.

“I have had very good engagement with Paschal Donohoe on this and he is an important minister in this space to help me bring about a resolution here,” he said.

“I have had no resistance or difficulty here I am happy to say across the three Government parties.”

Urgent

He said the Government was treating the problem with the urgency it deserves – and said he expects to hear back from Minister Donohoe, “in a matter of days.”

“I think we will be looking at options in a very short space of time, meaning next week,” he said.

“Then work out about how we can move them forward on a legislative footing.

“I am open to amendments on the planning side and that might form part of the solution but I am certain as well, on the finance side we are going to have to see substantial changes in relation to how these funds are given the designation and for what.

“If it is to increase supply for city centre apartments, then one could see a place for it but I don’t see a place for these funds buying up family homes – absolutely not.”

He admitted that the 80,000 planning permissions that are already in the system would not be affected by any changes to planning law, warning, "that's why the tax element is so important."

Asked about the Labour Party’s plan to re-introduce his own legislation from his time in opposition, Minister O’Brien said the party was entitled to do that - but noted that, “Labour was part of the Government that brought these funds in the first place.”

The Tánaiste Leo Varadkar has already rejected calls to ban institutional investors from buying up Irish homes.


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