The Housing Minister is defending his decision to let cuckoo funds avoid the new 10% stamp duty on bulk-buying homes if they are leasing them back to the State.

The 10% tax on purchases of 10 or more homes was a major part of the Government’s attempt to prevent investment funds from buying up housing estates ahead of first-time buyers.

However, an amendment to the plan tabled by Housing Minister Darragh O’Brien will exempt funds from the tax if they are leasing the homes back to the State for social housing.

Opposition parties have been highly critical of the amendment, which comes before the Dáil this evening.

Social housing

This afternoon, Minister O’Brien defended the move – insisting that it will ensure thousands of families can access social housing in the coming months.

“There is a reality that about 2,500 families are due to be housed through the provision of these leases,” he said.

“So, if anybody is telling me now that we shouldn’t make an exception for them so that those families are housed in the short-term, I would like them to put the argument to me.

“It is a small exemption that will be time-bound. That will be brought forward by [Finance] Minister Paschal Donohoe as well.”

He suggested the social homes would be “jeopardised” if the amendment is not passed.

“It is very simply to make sure we have 2,500 individuals and families over the coming months are housed through this.”

"Brazen and dishonest"

In the Dáil this afternoon, the Sinn Féin leader Mary Lou McDonald said the amendment proved that the Government was still incentivising funds to buy up homes, “forcing regular buyers to compete with large investment funds”.

Meanwhile, the Social Democrats co-leader Róisín Shortall claimed that, instead of trying to catch funds evading the new rules, the Government was “actually helping them to do so.”

She described the amendment as a ‘brazen and dishonest U-turn.’

The Taoiseach Micheál Martin said that, without the amendment, 2,400 people could find themselves without a home.

He said it protected the short-term supply of social housing while the Government turned its focus to direct building.

Cost rental

Minister O'Brien was speaking at an event welcoming the first 25 new-build homes into the State's cost rental housing scheme.

Some 440 homes are to be available as part of the new housing model by the end of the year in locations incuding Kildare, Dublin and Cork.

Tenants are guaranteed rents will be set at a minimum of 25% below open market value.

With reporting from Kacey O'Riordan