Proportion of new homes bought by institutions up six-fold in 10 years

The average price of homes bought by institutions also increased dramatically from 2016 to 2019, from €229,627 to €304,811
Proportion of new homes bought by institutions up six-fold in 10 years

By James Ward, PA

The proportion of newly-built homes bought by institutions has increased from 5.6 per cent in 2010 to almost a third in 2019, a report has found.

It marks a six-fold increase in the last decade, the research shows.

The National Social Monitor, by think tank Social Justice Ireland (SJI), has questioned the ability of the State to deliver affordable housing when families are increasingly crowded out of the market by private bodies.

The average price of homes being bought by institutions also increased dramatically in the years between 2016 and 2019, from €229,627 to €304,811.

This represents an increase of one third during the lifetime of the Rebuilding Ireland programme, the report says.

Collette Bennett, an economic and social analyst with SJI, said: “We cannot hope to deliver affordable housing for all if households are competing with institutions in the market.”

The report notes commitments in the Programme for Government to drastically increase the number of houses being built, and says these efforts are undermined by fewer homes going to families.

It states: “An increasing proportion of newly built homes were bought by ‘non-household’ entities.

“In 2010, the proportion of new homes purchased by non-household entities was 5.6 per cent.

“By the end of the year 2016, the year Rebuilding Ireland was published, this had increased to 21.8 per cent, increasing again to 32.9 per cent in 2019.”

Waiting lists

The report has also criticised the Housing Assistance Payment (HAP), saying it creates the impression that social housing waiting lists are shorter than they actually are.

It states: “In September 2014, the then Government introduced the Housing Assistance Payment as a long-term social housing solution, similar to the Rental Accommodation Scheme (RAS).

“As such, households in receipt of HAP or RAS are not included in the data on social housing waiting lists.

“The impact of HAP can be seen when we consider that the real number of households in need of social housing has increased by 33 per cent since 2016, when the data reported 90,600 households.

“The latest housing waiting list data shows just 61,880 households at the end of 2020, however the perceived reduction is due in part to the transfer of 14,655 from rent supplement to HAP between 2016 and 2020, and a further 4,857 transfers from the rent supplement to the RAS in the same period.”

The report says the practice is “not sustainable”.

Between 2015 and 2019, some 65,040 households started HAP tenancies, but just 14,400 exited them.

Social Justice Ireland has issued a 10-point plan to deliver affordable housing for all.

It calls on the State to take equity in properties that are in mortgage distress, leaving the residents in situ while at the same time increasing the State’s housing stock.

Rental market
The report has criticised the Housing Assistance Payment (HAP) for artificially lowering social housing waiting lists (Yui Monk/PA)

It also calls for a €3.3 billion annual investment to deliver 14,341 social homes over the next 10 years.

A ban on the sale of State lands suitable for residential development should be introduced and the land used to build social housing, the report says.

It also urges the Government to close all tax loopholes for large-scale investment vehicles purchasing residential properties.

New legislation should also be introduced to increase tenant protections, including long-term leases, SJI have said.

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