The Minister For Finance missed the chance to influence the
supply and continuing rising cost of new homes in the Budget, according to
Chartered Surveyors group Real Estate Alliance.
Landowners now have a greater
incentive to offload potential development land as a result of today’s Budget,
but more action was needed to increase the supply of new homes to market.
Real Estate Alliance (REA) is
Ireland’s leading property group of Chartered Surveyors with over 50 branches
nationwide, comprising many of the country’s longest-established auctioneers
and estate agents.
“The dropping of the 80%
windfall tax on development land may provide some incentive for landowners to
offload potential sites as the tax will now fall into line with the standard
CGT rate of 33%,” said REA Chief Executive Philip Farrell.
“We also welcome the Minister
for Finance’s intention to commence a consultation process on addressing the
area of landowners holding on to suitable development lands in anticipation of
a large increase in values over the coming years.
“However, we feel that it is
crucial that this process is initiated immediately as the fundamental issue in
the marketplace is the lack of supply of homes.
“The significant recent
increases in property values are not credit driven and whilst the proposed
introduction of new borrowing restriction for purchasers for 2015 may stem the
demand somewhat, it still does not address the primary issue of supply of new
homes.
“We also feel that the Minister
missed an ideal opportunity similar to that introduced in the hospitality
sector in recent years to temporarily reduce the VAT payable on new homes which
currently stands at 13.5% in an attempt to increase the supply of new housing.
“The proposed new lending
restrictions on purchasers will create extra pressure on rental values
nationally in 2015.
“REA welcome the extension of
the Home Improvement Scheme to provide relief for investor/landlords.
“This can only lead to a higher
standard of rental housing stock than is currently being provided in the
marketplace.”
Available for interview:
Philip Farrell, CEO Real Estate
Alliance
086 250 3515 / philip@realestatealliance.ie
086 250 3515 / philip@realestatealliance.ie
Media information:
Darren Hughes, MediaConsult 086 2937037 / darren@mediaconsult.ie
