Tuesday 15 October 2019

FF pledges clampdown on cuckoo funds by ring-fencing properties for families

‘Free ride’: Fianna Fáil’s Darragh O’Brien said cuckoo investors didn’t pay corporation or income tax. Photo: Tom Burke
‘Free ride’: Fianna Fáil’s Darragh O’Brien said cuckoo investors didn’t pay corporation or income tax. Photo: Tom Burke
Philip Ryan

Philip Ryan

Property developers will be forced to devote a significant section of all new developments to homes for sale under laws aimed at clamping down on cuckoo fund investors.

The proposed planning regulations, which are the centrepiece of Fianna Fáil's local election manifesto, would greatly increase the number of new homes on the market and make build-to-rent developments less lucrative.

The party also wants to rip up legislation which introduced huge tax incentives for international corporations investing in the Irish commercial property market.

They have given rise to the cuckoo fund phenomenon with entire housing developments being snapped up, locking out individual buyers.

The new planning proposals would be implemented in a similar way to current laws which require developers to earmark a certain portion of all new developments for social housing. At present, developers must offer 10pc of homes at a discounted price to local authorities under the Planning and Development Act 2000.

Under the Fianna Fáil proposal, developers would not be given planning permission if applications did not contain a significant number of homes for sale.

It also wants to dramatically change six-year-old legislation which introduced tax breaks for international firms investing in Ireland.

REITs - real estate investment trusts - were legislated for in the Finance Act 2013 to make Ireland more attractive to investors after the economic crash. The Government has been reluctant to change the legislation.

Fianna Fáil housing spokesman Darragh O'Brien said the investors were getting a "free ride" and it was time to "severely restrict" them from block buying new homes.

"They are not paying corporation tax and they are not paying income tax.

"Meanwhile, the cost of rent remains stark and people are being squeezed out of the dream of home ownership," Mr O'Brien told the Irish Independent.

"We are not telling investors to get out of Ireland because there is always a place for international investment, but it should not be at the expense of ordinary people hoping to own a home."

Irish Independent

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