Seanad debates

Friday, 4 June 2021

Affordable Housing Bill 2021: Committee Stage (Resumed)


9:30 am

Photo of Paddy BurkePaddy Burke (Fine Gael)

Section 34 is the kernel of the Bill.It goes to the heart of it all. I fully support everything Senator Cummins has said. He has explained in great detail why we have gone down the route of cost-rental dwellings. The kernel of all of this is taxation. When the crash happened, developers and builders were demonised. We arrived at a situation in which we had no builders and no developers. Nobody was willing to take on big projects like the Ballymore Group and Michael O'Flynn had. They were demonised during the crash. The people now being demonised are the private landlords. The private landlord is up against everything now. It is more than likely that he is paying tax at 52%. The Land Development Agency, in conjunction with the approved housing bodies, AHBs, is now going to provide quite a number of cost-rental apartments at €1,200 per month. This is equivalent to what a private landlord providing a house at €2,400 receives after tax. If there were no tax, such landlords would be able to provide the same apartments at €1,200 a month. I have said on quite a number of occasions that the taxation levied on private landlords is penal. Many of these are accidental landlords. Perhaps they were changing jobs and had to rent a property and so decided to rent out their own house.

If the Minister of State checks over the records over the past number of years, he will find that the number of private landlords has reduced significantly. Quite a lot of them have left the sector, the reason being that it is too much hassle. People ask why properties are not done up or why there are so many vacant properties lying idle around the country. It is because it costs too much for landlords to do up their properties in light of what they receive and the tax they pay. That is the kernel of all of this. I have great sympathy for landlords but there is no great sympathy for them right around the country because of the amounts they charge per month. The taxation, however, is penal at 52% in the case of most private landlords. The Land Development Agency is now to work in conjunction with the AHBs, bodies that may be paying no tax at all. That is why they can rent properties at €1,200 per month. There is a commitment here that the rents will be in the region of €1,200 a month. A situation will arise in which some will be paying €2,000 to a private landlord while an AHB is providing an equivalent apartment down the road-----


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