Duncan Smith (Dublin Fingal, Labour) | Oireachtas source

I thank the Minister for tabling the Bill in the House for debate. He seems to have shifted on the Bill following the discussion in the Seanad, and there will be more shifts on Committee Stage in terms of Part V developments. I look forward to further detail on same.

I wish to speak about affordability and what is happening in the market. House prices are increasing all over the country. There is a general assumption that this is based on pent-up demand now hitting a market with a low level of supply. There is a degree of truth in that, but as the Minister knows, I have been paying close attention to the activities of investment funds in the second-hand housing market across the country, particularly the Dublin region, which includes my constituency. The impact of those activities on prices is disgraceful and is artificially inflating what is already a red-hot housing market.

In recent months, I have been tracking a particular estate in my constituency, which the Minister also represents. Four houses were put up for sale in the early part of this year. They were the same type of house and each had an asking price of approximately €300,000, which in the madness of today's Dublin housing market actually seems somewhat affordable. That is how crazy the market is. Three of the four houses were sold off market to an investment fund. The fund offered €20,000 or slightly more above the asking price. The general public did not know that these three houses were for sale because only the fourth hit the websites and windows of estate agents. I do not know what the other house went for, but the three bought by the investment fund went for €320,000 or €325,000. A fifth house of the same type in the estate has now been put up for sale on the open market for approximately €330,000. That price is not to do with the pent-up demand of first-time buyers, families, people downsizing or whatever. Rather, it is down to the investment fund setting a price early this year of €320,000 or €325,000 off market. It is a large estate and I am not sure whether other new houses have been sold in recent weeks or will be put up for sale for investment funds to snap up. When we hit October or November, we will see asking prices of €350,000. Block buying apartments and estates like what happened in Kildare, Santry and elsewhere is disgraceful, but what is happening with investment funds in the second-hand market is disgraceful and immoral and it is not getting enough attention.

My example is relevant to the Bill because it raises a question about the extent to which investment funds are skewing asking prices and the impact of that on the calculations that will define affordability based on house prices in particular areas. As the Minister mentioned, there will be an area-specific ceiling. That sounds like a good idea, but I will not jump into a discussion on it because I want to hear more detail. It is scandalous that housing in a particular estate has increased in price by €50,000 because 75% of the purchasers are investment funds that did not buy from the open market. I would like the Minister to guarantee the Dáil that his Department is aware of this issue, is devising more sophisticated and harsher measures to tackle it and will not allow artificial activity in the second-hand housing market to impact the calculations for affordability, price ceilings and brackets for two-bedroom, three-bedroom or four-bedroom houses. My concern is that they will be artificially skewed.

When big investors and developers were active in the market previously and driving supply and prices, there was a visibility to it. We knew what was going on because it was being reported, but what is happening now is insidious and under the radar. We all need to discuss and tackle it more, but it is ultimately the responsibility of the Minister, his Department and his fellow Ministers where appropriate, for example, the Minister for Finance, to eradicate it from the housing market. It is taking homes away from people who need them.

I believe it was the Minister who stated that the average age of first-time buyers now was 36 years, or perhaps it was Deputy Ó Broin.

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