Sunday 23 October 2016

Seizing derelict buildings among moves proposed to combat housing crisis

230,000 empty houses to be taxed if not occupied

Ralph Riegel and Kevin Doyle

Published 24/05/2016 | 02:30

Housing Minister Simon Coveney: ‘get vacant houses back into use’. Photo: Tom Burke
Housing Minister Simon Coveney: ‘get vacant houses back into use’. Photo: Tom Burke

The seizure of derelict buildings and a tax on vacant homes are among the measures being considered in an effort to alleviate the housing crisis.

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Housing Minister Simon Coveney wants to bring a significant proportion of the 230,000 empty houses across the country back into use.

He said actively encouraging owners to make their properties available for occupation will be "a big part of our strategy".

"We need more housing, so if we have a lot of vacant houses which aren't being used, that is an obvious way to get a lot of houses back into the system quickly if we can find a way to incentivise bringing those homes back into use."

And Fianna Fáil's Barry Cowen told the Irish Independent he intends to seek "stronger" compulsory purchase orders (CPOs) that would "allow local authorities make derelict premises viable for residential or retail purposes".

He has already raised the idea at the Dáil's Housing Committee and wants a cross-party consensus on changing the CPO laws to overcome issues relating to property rights.

His plan includes a new refurbishment scheme for derelict buildings in a bid to "revitalise and re-energise towns and villages".

Funding would be made available for buildings that are in disrepair, buildings that have not been occupied and buildings where the owners do not have access to capital.

It comes as Focus Ireland warned the homelessness crisis is deepening with new figures showing 366 families and 731 children have become homeless in Dublin since January.

The increase brings the total number of families living in emergency accommodation in Dublin to a record 888 with 1,786 children.

A Housing Agency report for the Government said yesterday there were 230,056 vacant homes, mostly in private sector ownership.

Mr Coveney noted that some of these were linked to distressed mortgages and work would have to be done with the banks.

The minister said he "will listen to everyone's input here" and wouldn't make any firm decisions until he had done so.

He refused to discuss specific details of the proposed strategy beyond stressing that all policy options - including taxes and incentives - were under consideration.

"I am not going to give you the minutiae of how we are going to respond. That will all be in the action plan for housing when it is done.

"That will be done within the next two months. But certainly vacant houses that aren't in use could be and should be in use. It is, I hope, going to be a big part of our strategy," he said.

A source said all proposals, including Fianna Fáil's CPO idea, would be studied.

Mr Coveney also wants to achieve a construction rate of 35,000 houses a year rather than the 25,000 currently cited by the Government.

Director general of the Construction Industry Federation (CIF) Tom Parlon told the Irish Independent his members would work to increase supply "in a sustainable way to meet the changing needs of the Irish population".

"CIF believes that in the longer-term a national planning framework that outlines our housing and infrastructure requirements is necessary to ensure that the construction is calibrated correctly to meet the needs of Ireland's growing population," he said.

The Society of Chartered Surveyors of Ireland (SCSI) said less than half the cost of building a new home was accounted for by direct construction charges. An average €330,000 semi-detached house build involves only 45pc (€150,000) in direct constructions costs, the remainder being made up of taxes, fees, levies and land costs.

While Mr Coveney promised that reductions in construction taxes would be considered, the potential consequences of lowering levies will also be taken into account.

"If you reduce VAT (for new house construction) there is a cost to that. (That money) could otherwise be spent in grant aid or on direct build programmes and so on," he said.

Irish Independent

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