27th September 2022
The Irish Property Owners’ Association is shocked, disappointed and saddened that the Government has not addressed the serious issues which the Association has repeatedly brought to the Governments attention.
Once again Government have reneged on their responsibility to curtail the loss of valuable accommodation for Tenants.
In a note to members prepared just after the details of Budget 2023 were announced, IPOA Chair, Mary Conway said “No meaningful attempt has been made to prevent the exodus of landlords from the market in spite of the State not providing homes for people. Over the years the Irish Property Owners’ Association has outlined the causes of these much-needed investors leaving the market, taxation over 50%, needless compliance, rent control, the abolition of the affordable bed-sit, and complicated legislation. All this has caused and will continue to cause homelessness and a shortage of affordable accommodation. Changing the tax treatment of landlords would have gone a long way towards encouraging landlords to remain in the sector and new entrants to invest”
Tenants are our customers, and we want to facilitate their needs, but we are being pushed out of the market at a very high cost to the exchequer. Investment Funds have been given vast taxation breaks to supply the market with upmarket expensive accommodation and the traditional suppliers are being priced out. Remember the traditional suppliers are under severe rent control constraints and they supply some 265,000 homes when the Investment funds supply cr. 15,000.
The State needs to put in place conditions to encourage investment, to retain existing accommodation and treat investors in the rental market in an equal fair manner, taxing letting property as a business. The exodus of small investors is likely to increase, and it will have a significant detrimental impact on the sector leading people with capital to invest their money in an alternative asset class.
Below are the key housing points:-
Living City Initiative
Extension of the Living City Initiative (LCI) to 31 December 2027, acceleration of relief for owner-occupiers so that it can be claimed as a deduction from total income of 15% of the total eligible expenditure in each of the first six years and 10% for the seventh year and carry forward of relief for owner occupiers.
Increase eligible expenditure limit for pre-letting expenses for landlords to €10,000 and halve the vacancy period to six months.
Rent tax credit
Introduce a new €500 tax credit for private tenants who are not in receipt of other State housing supports. The credit will be claimable “in year” in 2023 and in subsequent years and from early in 2023 in respect of rent paid in 2022.
Vacant Homes Tax
A Vacant Homes Tax (VHT) will be introduced in 2023. The tax will apply to residential properties which are occupied for less than thirty days in a twelve month period.
Help to Buy
Extension of Help to Buy (HTB) to 31 December 2024.
- funding will be made available to support 8,800 new HAP tenancies and 800 RAS tenancies
- 9,100 new-build social homes, 5,500 new affordable homes for sale and rent and 6,500 new social homes will be supported
- funding to deliver 37,000 home energy upgrades
Extension of Residential Development Stamp Duty Refund Scheme to end-2025.