Peter Fitzpatrick (Louth, Independent) | Oireachtas source

I very much welcome the opportunity to speak. I thank the Deputies for bring this motion before the House. I welcome the fact that we can discuss the housing crisis once more and discuss why we are in this position. In my home town of Dundalk, the rental cost for a standard three-bedroom house is anywhere between €1,200 and €1,600 per month. To service a mortgage on that same property would be substantially less, but the fact of the matter is that the people paying rent of between €1,200 and €1,600 per month are, in most instances, not able to get a mortgage for that same property. This is one of the main reasons for the crisis we are in now. How is that people who can afford to pay this rent cannot get a mortgage? It makes no sense whatsoever. I have spoken about this previously and about how it is unfair to those striving to get on the property ladder.

We heard today how many new homes and apartments are being purchased in bulk by real estate investment trusts and institutional investors. I agree that this is a problem. They can outbid ordinary people for new properties and there is no doubt that they are driving the price of houses up. They are also driving the cost of rent up, which is not acceptable. The fact that real estate investment trusts and Irish real estate funds pay no corporation tax on rental income, or capital gains tax on the disposal of assets from their rental income business, is wrong. Why is this allowed to happen? As the motion states, it is having a detrimental effect on the Irish residential property market and the private rental sector. These institutions should no longer have these tax advantages when competing with first-time buyers in the property market. Their tax advantages should be abolished as a matter of urgency. They are distorting rental and property markets to the detriment of families who are struggling very hard to buy their own house.

A recent report by BNP Paribas Real Estate stated that 4,900 private rental sector properties were bulk purchased by investment funds in 2021, at an average of 32% above the asking price. The value of these investments is estimated at €2.27 billion and unless action is taken that is expected to grow even more in the coming years. How can ordinary families and workers compete against these institutions? I agree that legislation must be introduced to end the tax advantages and exemptions that have been granted to institutional investors, including real estate investment trusts and Irish real estate funds. Why do these institutions have these advantages? There is no justification for it.

One area that we need to look at is vacant homes. I have spoken many times on this issue and have repeatedly highlighted the issues in my home town of Dundalk. You could walk down any residential area of Dundalk and find at least one vacant property. How is this allowed? These properties are generally in well-established residential areas where the necessary services are already in place. I have previously highlighted the work of Louth County Council in bringing these vacant properties back into the housing stock. I know from my dealings with the council that these schemes have been very successful and the only thing holding Louth County Council back is the lack of funding from Government. Surely the Government can see the success of these schemes. Would it not be better to fund these schemes, instead of affording unfair tax advantages to institutional investors and trusts?

Recent data show that there are 44,905 residential and commercial properties lying vacant in the west, north west and Border areas like my constituency of Louth. The Government’s own targets state that we need 33,000 new homes on an annual basis. Surely the way forward is to tackle these vacant homes first and bring them back to the market. As I have already stated, many of these vacant homes are in established residential areas where services like schools, shops, medical facilities and so on already exist. We need to focus on the issue of vacant homes, which will, in turn, dramatically help the housing crisis.

People want to get onto the property ladder.

I do not like what I am hearing in my constituency office. I have people coming to my constituency office saying - it is a long time since I heard this previously - that they would be better off on social welfare. I ask the Minister to not go down that road again. A married couple coming to see me who are on the basic wage earn between €35,000 and €40,000. Local authorities have not changed the limits relating to their housing lists for the past ten years. It is totally unfair. People are coming to me and saying that they are out working and want to work, that they are paying €1,200 to €1,600 a month on rent, that they are coming home with maybe €25,000 or €30,000 after they pay their taxes and the universal social charge and that they are left with nothing. If they gave up work tomorrow morning, they would get €1,320 in HAP towards the rent. They would get medical cards. They would get everything and it would only cost them €25 per week for the house. I ask the Minister not to forget the working people. I am saying €35,000, but what happens if they have children and have crèche costs? All I am asking the Minister is to look after middle-class people.

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