Sunday 4 December 2016

Bill merger 'will make the housing crisis worse'

Published 12/04/2016 | 02:30

Both Fine Gael and Fianna Fáil have been warned that persisting with the idea of merging water bills with property tax would drive property owners away from the rental market and deplete the country’s available housing stock even further. Photo: Aidan Crawley/Bloomberg
Both Fine Gael and Fianna Fáil have been warned that persisting with the idea of merging water bills with property tax would drive property owners away from the rental market and deplete the country’s available housing stock even further. Photo: Aidan Crawley/Bloomberg

Ireland's housing crisis will worsen if the country's two main political parties insist on merging water bills with the property tax, according to landlords.

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Both Fine Gael and Fianna Fáil have been warned that persisting with the idea would drive property owners away from the rental market and deplete the country's available housing stock even further. The Irish Property Owners' Association said letting a property is already too expensive and warned any prospective government to tread carefully with the idea.

"I cannot see how anybody would welcome their (tenants) costs being included," a spokesperson told the Irish Independent.

"It is a service for the tenant that the tenant is responsible for. Any other confusion makes it more difficult and costly to rent out the property. This is partially why there are less people investing in the market and more people pulling out.

"It is going to discourage investment if you have to collect something else as well. With the water charges, the user pays.

"The costs of letting have increased substantially," the spokesperson added.

Charities and NGOs are also concerned about the proposals and any potential negative impact it could have on the housing crisis.

The Peter McVerry Trust said both Fianna Fáil and Fine Gael should take a considered approach to the ongoing negotiations. "Damaging the rental market could worsen the country's available housing stock," a spokesperson said.

"The rental market is already the primary source of new homeless cases and anything that could reduce rental affordability or reduce the supply of rental properties would be of concern," the homeless charity said. "We need to avoid knee-jerk political solutions.

"Instead, new measures need to fit into long-term policy logic."

A merger of water charges and the local property tax was first mooted over the weekend, as high-ranking Fine Gael and Fianna Fáil officials look to find common ground on the issue of water charges before discussing the formation of a new government.

Fianna Fáil wants to see Irish Water abolished and the bills suspended in favour of a national executive.

However, Fine Gael has insisted that water payments must stay as a stalemate between the country's two main political parties drags on.

Both parties are now looking at the possibility of amalgamating the water charges and the controversial property tax into one so-called 'household charge'.

Age Action Ireland has also warned that any new government needs to be aware of people's circumstances and ability to pay the new proposed charge .

Head of Advocacy for the charity, Justin Moran, said the idea of paying one bill instead of two could also be seen as more convenient.

"Combining these two charges together might be an opportunity to look at the charges again and see if there is a way of protecting people on low incomes," he said. "The concern for our people would be the rate that they will be facing.

"What we have seen in the past number of years is the income older people receive declining.

"State pensions stayed more or less the same and secondary incomes, allowances and benefits reduced," he said.

Irish Independent

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