Sunday 17 November 2019

Bill to protect first-time buyers from cuckoo funds

Deputy Darragh O’Brien TD
Deputy Darragh O’Brien TD

Ken Phelan

Fianna Fáil Spokesperson on Housing and local TD Deputy Darragh O'Brien has introduced a Bill to prevent so-called 'cuckoo funds' from buying up entire developments not designated as 'Build to Rent', freeing up housing stock for first-time buyers.

The 'Planning & Development (First Time Buyers) Bill 2019' will allow local authorities to earmark a certain percentage of zoned land - up to 30% at the discretion of the local authority - for first time buyers.

Deputy O'Brien said: 'We are in the middle of a home ownership crisis in Ireland. Ireland has already fallen from a world leader to behind the EU average ownership rate of 69% under Fianna Gael.

'Now, direct competition from massive institutional investors will mean many first-time buyers don't have a chance of owning a home in certain parts of Ireland.'

He continued: 'I have come across several instances where estates and developments have been bought on whole by institutional investors, leaving first-time buyers and movers behind. Without clear guidelines and safeguards in place this will create high rent in parts of Dublin and other cities.'

The Planning & Development (First Time Buyers) Bill 2019 comes after spending from institutional investors soared in 2018, including investors purchasing developments where first-time buyers had already placed deposits.

Deputy O'Brien said the Bill will 'level the playing field' for first-time buyers, operating on a similar basis to the current Part V Planning and Development Act 2000 provisions, which ensure that 10% of units are set aside for social housing.

Under the new Bill, each local authority must also review their housing strategy to set out its requirements for rental units over the lifetime of its housing plan.

This, Deputy O'Brien said, will ensure 'a full picture of the housing market is considered when the council sets out its future..'

The Deputy said: 'We should encourage appropriate investment, but not anywhere and not at any price. The Fianna Fáil Bill will allow for exemptions from the 30% First Time Buyers rule for Build-to-Rent developments, once they are part of the Local Authority Housing strategy.'

He added: 'This will allow developments such as Clancy Quay to proceed if they are in line with the Council's housing strategy. However, it will prevent developments that are not earmarked as just Build to Rent from being bought up by institutional investors when they go to the market.'

Fingal Independent