Life Homes

Tuesday 23 September 2014

Tax breaks were a 'disaster' for rural housing industry

Published 15/12/2012 | 05:00

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JUST a few short years ago, it was marketed as perfect for commuters seeking a country lifestyle within reach of the city.

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Lucrative tax breaks helped build hundreds of new homes for people hoping to commute to Dublin, but how things have changed in Longford.

Today, the midlands county has the slowest property market in the State, with just 146 houses and apartments sold so far this year.

Data from the Property Price Register shows that the average house sold for just €94,987 – it's better than the €87,566 average in Roscommon, but the neighbouring county saw 285 completed sales.

Auctioneer Jonathan Quinn, from Quinn Brothers in Longford town, says the tax breaks which allowed so much housing to be built were a "disaster".

They resulted in so many empty units across the county that banks and receivers are selling them at very low prices.

"There was a good house on sale for €135,000, and there was a bid of €120,000 on it," he explains. "The bank put an exact one (in the same development) up for sale for €90,000 which sold for €95,000. It was the same person who put in the bid for €120,000.

"The tax incentives were a disaster because there was a lot of investor-led development which led to an overhang of houses and apartments. There's been repossession and receivership sales, which set new lows each time. It's put a scare on the market."

The market is still "very slow", he says, and prices have fallen dramatically, up to 50pc from the height of the boom.

There is a shortage of one-off family homes, but things are improving.

The number of viewings is increasing, while people do seem to be able to secure mortgages.

"We have felt we have reached a floor for about the last 18 months," he adds.

It's not just Longford that has a very weak market. The Property Price Register data also shows that just 148 homes were sold in Monaghan, 160 in Leitrim, 189 in Carlow and 247 in Cavan.

Irish Independent

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