The Government’s 10 per cent stamp duty on the bulk buying of new homes is failing because since it was introduced property funds “have been emboldened”, according to Sinn Féin leader Mary Lou McDonald.
She said that bulk buying actually increased in the years since. “They can offset the stamp duty by charging sky high rents,” she said.
Raising the issue in the Dáil she said that according to the CSO over 4,200 homes were bought up by funds in 2021 and 2022 “and your response is really no response at all”, she told Taoiseach Simon Harris.
The Dublin Central TD said Mr Harris had told reporters that as he canvassed around the country he had heard too many examples of bulk buying of homes by wealthy property funds. But it was only now, two weeks before an election and “after backing the property funds to the hilt”, that the Taoiseach says “there are too many examples of funds bulk buying and that he wanted a review”.
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Ms McDonald said she had lost count of the number of times she had raised this “greedy and damaging practice” with the Government.
She pointed out that in January a British fund brought up 46 of 54 units in a new estate in Balgriffin and then put them up for “extortionate rent of up to €3,000 a month and this wasn’t a once-off”.
“Property funds bulk buying is a direct result of Government policy. Over a decade ago Fine Gael rolled out the red carpet to these funds with sweetheart tax deals. You’ve renewed that policy year after year repeatedly choosing to value the interests of vulture funds over ordinary people looking to buy a home,” Ms McDonald said.
The Taoiseach’s call for a review was simply “spoof” and “spin”.
Mr Harris described housing as one of the “biggest intergenerational challenges of our time” and said that this year more than 32,000 home builds had commenced, almost as many as the total for last year, while 500 individuals are getting mortgages every week.
He wanted to see further action on bulk buying but, as the Housing Commission report said, “we do need both private and public investment” to build the housing stock.
Bulk buying could not be allowed to continue unimpeded, however. He said the Government had already acted by putting in place both tax and planning measures. “I want to take further measures,” he said.
The Government had already introduced the higher stamp duty rate of 10 per cent compared to 1 per cent for individual homeowners and section 28 planning regulations that ensure that new developments cannot be sold in bulk and only to individual purchasers.
He said the Government is committed to ensure that newly built houses are available to first-time buyers and owner occupiers and the Government will continue to examine how best to achieve that.
The higher stamp duty rate has applied to less than 1 per cent of properties between May 2021 and the end of 2023, he said.
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