The UK government has finalised a staggering €3.24 billion deal involving 9,000 social housing lease agreements with property investment companies. These arrangements, spanning a quarter of a century, conclude with the full asset ownership reverting back to the investment funds, as was reported in the House of Commons.
The leader of Sinn Féin, Mary Lou McDonald, has censured the government’s about-face with its previously stated commitment to wind up prolonged leasing by 2025. She criticized the current administration, suggesting they have intensified this wasteful strategy, resulting in substantial earnings for real estate funds.
Echoing McDonald’s sentiments, the leader of the Social Democrats, Holly Cairns, stressed that these deals incorporate only upward rent revisions that aren’t subject to caps in rent surge zones. She pulled no punches, stating, “if you attempted to conceive a more inefficient method of providing social housing, you’d fall short. In essence, the deals are detrimental to the state in every way, whilst proving lucratively attractive to the investment funds. They guarantee high rents with unlimited increases and confirm the fund’s ownership of the property at the lease’s end.”
According to Cairns, a house that rents for €3,200 per month would amount to a €900,000 expenditure by the conclusion of the lease, with ownership returning to the investment fund.
However, Irish Prime Minister (Taoiseach) Simon Harris fervently defended the government’s policy to conclude protracted leases by the end of December 2025. He emphasised that leasing can provide short-term solutions for some social housing demands and in a crisis, every available option needs to be exhausted.
Harris underscored the policy’s imperative of providing a roof over some vulnerable citizens, noting that housing policy isn’t solely about ideology and emergency. He stated the policy comprises only a minor part of comprehensive housing provision. He proudly highlighted the output of social homes reaching its peak in decades the previous year and confirmed 337 new buildings are being commenced each workday, an extension to rent pressure zones to the conclusion of December 2025 while every week, 500 individual people or couples are purchasing their first properties.
Ms McDonald criticised Fine Gael for having incorrect priorities and policies during their 13-year stint as government. She highlighted one instance in Dublin where they had established a property lease for 25 years, costing €3,200 per month, with numerous others costing around €2,500. She alleged that enriching private stakeholders, corporate landlords, and cuckoo funds had been a distinguishing element of Fine Gael’s housing policy.
When asking Mr Harris about the number of established leases, she pointed out that the 2021 government had promised to eliminate these long-standing leasing agreements for social housing by 2025. Despite this promise, she accused the government of making an expensive about-face, thereby binding the taxpayer to this reckless policy for a quarter-century.
On the other hand, Ms Cairns questioned the Taoiseach’s claims on the topic of common sense, asking if these lengthier rent agreements made any logical or financial sense. The Taoiseach responded that the government would honour its commitment to end long-term leases in 2025. He added, optimistically, that the previous year saw the construction of more than 32,000 homes, and that they were on track to amplify housing targets in the near future.
He expressed that Ireland is a nation where, on a weekly basis, 500 individuals or couples have purchased their first home during the year leading up to February. Despite Sinn Féin’s opposition, he noted that almost 2,600 approvals were given for the first-home scheme. Emphasizing progress, he pointed out that the statistics indicate substantial advancements for many homeowners, in spite of criticisms of failure.