April 19, 2020
Fianna Fáil’s long-term leasing proposal ‘the height of economic stupidity’ – Eoin Ó Broin

Sinn Féin spokesperson on Housing Eoin Ó Broin TD has described Fianna Fáil’s proposal to lease homes for 100 years from private developers to meet social housing need as ‘the height of economic stupidity.’

He said:

“Fianna Fáil have proposed leasing homes from private developers for 100 years to meet social housing need. This proposal is the height of economic stupidity. 

“There are currently two government leasing schemes. The standard long-term scheme sees property owners lease properties to local Councils for 25 years. Because Councils are liable for the cost of maintenance, the cost of the lease is substantially below market rent and the average cost of these leases as of the end of 2018 is €8,000 per year. 

“This would mean that the cost of acquiring a property under lease for 100 years would be €800,000. Given that the average cost of building a new Council house is currently €234,000; a long-term lease would be three and a half times more expensive than building.

“A second leasing scheme was introduced in January 2018 called the Enhanced Leasing Scheme where the property owner maintains the landlord function and in return gets 95% of market rent for the duration of the lease.

“With Dublin rents averaging €1,750 per month, the cost of an Enhanced Lease would be €1,662 per month, or €19,000 per year (€1.9 million over 100 years).

“Both forms of leasing scheme represent exceptionally bad value for money for the taxpayer and these schemes need to be phased out, not extended. 

“That Fianna Fáil would propose such a giveaway to property developers is no surprise – that’s what they did when they were last in government and it wrecked the economy.

“The best solution to address the social housing crisis is to increase capital investment in public housing on public land to meet social and affordable need – something both Fianna Fáil and Fine Gael have refused to do for decades.”

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