Mick Wallace (Wexford, Independent) | Oireachtas source

My Bill does not deal with compulsory purchases. Under my proposed arrangement, a developer who was willing could agree a sale with a local authority at approximately 60% of the market value instead of paying the 25% tax rate. At 50% over two years, it would be cheaper for the developer to sell the property if he or she were not in a position to hold it and pay the tax. This would have given site owners a way out.

The idea is to stop landbanking by making it less attractive. Deputy Jan O'Sullivan stated that Labour could not achieve a higher levy than 3% because it would have been illegal, but now the Government can achieve 7%. Explain that. If 3% and 7% are okay, the principle is the same whatever the figure, so if 25% is illegal, then 7% is as well. That does not make any sense. Come on. The notion that 7% would work is total bollocks. The average price of a house in Dublin is €357,000. Let us say that, last year, it was €300,000 before increasing by 10% to €330,000. However, build costs did not change, which means the land price did, increasing from €100,000 to €130,000, or 30%. Where is the Government going with its 7%? It is a waste of time. No one in his or her right mind will bother with 7%. Nor will it catch the majority.

The Minister of State, Deputy English, stated his belief that there could be a legal problem with the appeals mechanism. He mentioned introducing it in January 2020. If the four appeals were left, it would take only five or six years for anyone who went to the effort - it would pay plenty of people to do it - to get into the net. That means 2026. Where will the housing crisis be then? Let us tackle it now. We must. It is the elephant in the room, but the Government does not want to see it and is pretending it is not there. Jesus, it is so attractive to buy these large tracts of land. NAMA sold 3,800 sites in Cherrywood to Hines, a vulture fund, for €27,000 each. Hines then sat on them because it did not have to pay annual tax for doing so. No hassle. Hines moved the first of those sites at €72,000. I know to whom it sold them. It sold the next little bundle for €100,000. Then it started selling sites for €120,000. I do not know what it has done with the rest. It is probably still sitting on them.

We encourage landbanking in Ireland. Through the policy decisions made in this Chamber, we encourage houses to be unaffordable. That is a fact. Thirteen consecutive Governments have refused to deal with landbanking. We will never have affordable housing if the Government does not deal with landbanking. As Deputy Ó Broin said, it is not just about supply. Supply was never greater in the history of the State than it was in 2006 and 2007, yet affordability was non-existent. Prices went through the roof and reached their highest levels ever. The idea that prices reduce when there is greater supply does not stack up. It can happen, but it does not necessarily happen. There is no rationale behind this. Look at the history.

One of the reasons for apartments and housings growing so expensive when they are plentiful is that those who own landbanks will not make the land available until the price goes high, when it will then pay to sell. They will not do it otherwise. Over the past six months, I have examined sites in this city. People are putting a price on apartment sites that a builder cannot afford. The equation between what a builder is asked to pay and what his or her build, financing, legal and other costs are does not work at the moment. By the time the builder sells, there is no money in it. That is why no one is building apartments. The people who own the land in the private sector have no incentive to sell because they know they will get more for it later and do not have to pay any tax while they are sitting on it and watching its value grow.

In the meantime, the Government is not getting sites freed up to deal with the housing crisis. What is it thinking? This is so frustrating. If the House did nothing else this year other than deal with the issue of landbanking, it would not solve every problem overnight because Rome was not built in a day, but it was started. We have not even started. The Kenny report came up with an idea, but I am not suggesting we use that report, since that will never happen.

The Bill's measures would have a major impact on and be game changers in how we supply housing, but the Government has to have the appetite to do so. Stop being afraid of legal types saying this or that cannot be done. I can understand. I would say they wore the carpets out in the Department of the Environment, Community and Local Government when the Government was trying to introduce the site levy. Let them come. Let them take their case to the courts. Let us test it if we have to, but I do not believe for a second that it needs a referendum. It needs the Government's will to do things differently. More than 99% of the people of Ireland would benefit from this, but the Government still will not do it because it claims there is a legal issue. Come on, do the right thing.

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