Sunday 25 August 2019

Government warned of rent bubble crisis for pensioners

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Wayne O'Connor

Wayne O'Connor

The Government has been warned a new wave of homelessness will be sparked by policies incentivising institutional landlords and forcing individuals out of the rental market.

Experts have told the Government it must urgently address rental-market concerns or risk long-term unintended consequences for a generation of renters who will not be able to afford accommodation after retirement.

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It comes as Finance Minister Paschal Donohoe moved to defend so-called vulture funds buying loans from banks.

Writing in today's Sunday Independent, Mr Donohoe says borrowers are not put at a disadvantage when their loans are sold by a bank to private equity companies.

He also rounds on Sinn Fein and Fianna Fail over their calls for new legislation to offer borrowers greater protection by forcing banks to seek a customer's permission before selling a loan.

Mr Donohoe writes that a new Sinn Fein "No Consent, No Sale" Bill aimed at addressing the issue will cause harm.

He said Central Bank research shows the code of conduct around dealing with cases of mortgage arrears is working and there is no difference in the level of repossession activity between banks and private equity firms.

Data from the Central Bank shows 166 residential properties were repossessed in the final three months of last year. Vulture funds took possession of 32 residential properties during the same period.

Also writing in today's Sunday Independent, the Institute of Professional Auctioneers and Valuers' chief executive Pat Davitt has warned against vast swathes of property in the capital being bought up by institutional landlords with devastating long-term consequences.

"Parents will remain paying rent into retirement, many with only the State pension to support them," he said.

"This pension is based on the assumption people don't have significant rent or mortgage commitments. There is every risk they will become the new homeless."

Sunday Independent

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