A vacant property tax looks set to feature in the Government’s new Housing for All plan with a vacant sites tax also under consideration.
Minister for Housing Darragh O’Brien will bring the latest draft of the long-term plan to solve the housing crisis before a Cabinet subcommittee next Monday where the last details will be signed off on ahead of publication.
Talks are still under way between government departments on a plan which would see couples or individuals given a grant to renovate vacant properties in towns around the country.
Agreement in principle has been reached to go ahead with a vacant property tax based on forthcoming information in relation to the local property tax. Owners of vacant homes now have to declare their unused houses to the Revenue Commissioners and explain why they are empty and this information will be needed first.
There is increasing unhappiness in Government with the existing vacant sites levy which has been in place since 2019 and is collected by local authorities. Introducing a vacant sites tax instead, to be collected by Revenue, is “on the table”, a source said.
Project Tosaigh
Discussions are also under way to introduce an incentive for people who want to downsize to a smaller home which would see a halving of the stamp duty charge from 1 per cent to 0.5 per cent. The incentive is designed to make it more attractive for people living in family homes to trade down after their children have left, particularly to apartments, via a halving in the stamp duty bill on the purchase of the smaller property. The measure would be introduced in the budget, due in October.
Other new measures will include a plan code-named “Project Tosaigh”. This will see the Land Development Agency play a role in activating thousands of dormant planning permissions which have not yet been activated on lands which may be privately owned. They could take a partnership role in a project or they could take them over and develop them out.
This could deliver thousands of houses in larger urban areas if the plan is successful.
The multibillion plan will aim to deliver 33,000 houses a year by 2025. The exact split between public and private, and social and affordable will be announced by the Government either next week or the week after.
Land earmarked
Thousands of homes could also become available under a plan to allow families keep rents where an elderly homeowner is in care under the Fair Deal scheme. Currently 80 per cent of the rental income derived from the owner’s home must go towards their nursing home fees.
The Department of Housing has also earmarked land controlled by commercial State companies for the expansion of the planned home-building programme, including sites controlled by CIÉ and the ESB.
The Government is also advancing plans to transfer some 1,400 social housing units to the Land Development Agency from the National Asset Management Agency (Nama).
Another centrepiece of the plan will see “land value sharing” introduced, which would see property owners and developers compelled to pay the State up to half of the increase in the value of land when it is rezoned for housing. The aim is to ensure the State makes a gain from the significant increase in the value of private land that arises from zoning and investment decisions by public authorities.
Similar measures were proposed as far back as the early 1970s in the Kenny report, a landmark document on controlling property prices, but were never advanced.
