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Danny Healy-Rae: Blames out-of-town supermarkets for town decline

Danny Healy-Rae: Blames out-of-town supermarkets for town decline

Danny Healy-Rae spoke about vacant homes, town centre decline and the causes of dereliction, blaming out-of-town supermarket developments and tax disincentives. He argued for tax relief or government payments to make renting vacant houses viable and said current rules favour tenants and penalise small landlords.

Out-of-town retail impact


He said streetscapes and townscapes were damaged when local authorities gave planning to multinational supermarket companies to build large retail estates outside towns, removing footfall from town centres and making parking and access easier at out-of-town stores such as Tesco.

Local vacancy and dereliction


He gave local examples, including "55 houses vacant" beside a road and properties on Sutton Road, and warned that vacancy quickly leads to dereliction, damp and smells. He noted that many empty houses have good transport links, with buses and connections to Killarney, yet remain unoccupied.

Reasons owners avoid renting


He said owners do not rent mainly because RTB rules favour tenants and landlords fear they cannot regain possession, and because rental returns are eroded by taxation. He estimated owners might get €1,000–€1,100 a month but be left with around €500 after tax and costs, which he argued makes letting unviable for small landlords.

Policy proposals and calls for relief


He proposed exploring tax treatment changes – separating residential rental tax or offering tax-free payments – and referenced a scheme available to Ukrainians of a €600 tax-free payment. He called for targeted tax relief or incentives for people who renovate vacant buildings into rental properties and asked for support to raise the matter with government.

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Transcript
Chairman, I'm glad to get the opportunity and thank the witnesses for being here, I suppose. Some of the things I have to raise, I suppose I've been raised several times in the Dáil Chamber and I suppose it's sad when I don't see a response coming, I suppose. When you talk about vacancy and dereliction and how to deal with it and how to sort it out, I mean, we must look back at how it began or why it happened. But to me anyway, our streetscapes and our townscapes or whatever, they got affected when local authorities and government policy at the time gave planning to multinational supermarket companies to build a big retail estate outside of towns. That took the footfall out of towns because, and it took away the problem for the customers. of parking, you can hop into any, drive in, practically to the door of any Tesco, any of these soot dunes or whatever and park their own, and it won't be cut by traffic warden or nothing, you have no problem. And that's why most of our towns and villages have disintegrated. And in relation to the residential side of it then, you see, there's no impetus or no honest or there's no kind of incentive for people with a second house. There are 55 houses vacant to the side of the road, for as long as I can remember now, you could step out of the houses into the bus. There's a bus going both ways every half hour, you couldn't ask for more, into Killarney, and there's connections to car, connections everywhere. The reason the owners won't rent out the houses, there's two reasons. One, the laws that are there now for, and the RTB favour the tenant, and they're afraid they can't get their houses back when they need them. That is paramount, and that needs to be sorted out. The other one is, we have to realise that in those cases you may only get a thousand or eleven hundred euros a month for the houses. These people might have other jobs, the owners, and if they rent them out, they'll pay half of what they get in tax. So they're left with maybe 500 euros to deal with all the bills and to keep the house in order, and that's the God's gospel of the truth. They don't see that it's worth their point. Now, in other countries, because they're treated as 50% in the 50% tax bracket, in other countries, your residential tax of 20% is nothing to do with your income tax. We need to adopt something like that. Or, what would be way better altogether, what's available to Ukrainians, is you get 600 for your house, tax-free, the government are actually paying it. But I would see nothing wrong with tenants paying it, because they're in a bad way, tenants looking for places to rent. Many of them would be glad to pay the 600 themselves, but the landlord needs to get it tax-free. If they get more for the houses, all right, let them pay the tax on the extra amount. So I'm only asking, what are your views? Am I mad? Or is there a sense in what I'm saying? Or do we think it should be explored? Okay, thanks, Deputy. Briefly, if we can. I don't think you're mad. There's definitely some sense there, and it's interesting because, obviously, we have tax on rental income as one issue. But when we look at it in terms of vacant homes, because they're so risky from the outset, the cost profile is so high, and then because the reward at the end is taxed so heavenly, that disincentivizes people to turn these houses around. So why go through the process of a difficult project that's going to cost a lot, and at the very end, your tax is extremely high, and you may not see your break-even point for a decade or so. So in terms of this topic that we're discussing today, yes, can we have some sort of tax relief for someone who goes through the process of turning a vacant building into a rental property? I think that is a good point. There needs to be proper reliefs and incentives at the end of a project to encourage someone to start the project. That would be a good view that we have on it. And sure, we have to realise if a house is vacant, even a house after 12 months being idled, it's starting, there's a smell, it gets damp, and different things happen, at least have the windows open. But vacancy leads to dereliction. And I think we need to start there, Chairman, and I'd be glad of the support to talk to the government, because I seem to be getting over with it. I'm at it with the last two or three years, because I went through all the houses on the Sutton Road. I know each and every one of the people. It's not worth their oil for what they would get. And you see, actually, the government are the biggest beneficiaries of renting a property. Well, maybe not the ones that have 20 or 30 houses or whatever, because they're in a lower rate of tax. They're in, I don't know what they have, you know, they're under corporation tax or whatever rules. But the person with one or two houses, they're paying tax at 50%. It's not worth their oil. Yes, exactly. And these are out of the country, they're inside villages like Kilgarven, Guinea Village, different places, Scotland, there's houses all over the place. People lived in them, they were happy in them, and I see no reason why it couldn't happen again. But there needs to be a wheeler. And for it to work, the government must realise that they must pay their part as well. No, thanks, Deputy. Any quick reply? I just wonder, did you ask them, why don't they sell the properties? I mean, you said they're empty for years and years. There can be many reasons why they won't sell it. One would be sentimental value. Other reasons, like, they might be waiting for a son or a daughter to come back. We see so many young people immigrating these days. And I was at a function the other night where 10 of them were going away before Christmas. They won't be here for the Christmas dinner this year. They're going to Australia. And they're holding on to the houses. They wouldn't rent them in the meantime. There are different reasons why they're holding on to them. There might be someone belonging to them in hospital. They're not waiting to see if they'll come back or whatever, or see if they'll get an improvement in their story. There's different reasons. OK, we need to move on. Sorry, June, briefly. Just, I suppose, a quick point. What we're calling for here is for people who have emotional attachments to buildings. It must be really hard for them to watch them decay and not be lived in and not to have families enjoy them. So what we would like to see is mental health supports for people like that, maybe to help them let go of these homes that then they could go to families to sell them on. But to help them get over that emotional attachment, not everyone's going to agree with that. In terms of tenants' rights, if someone is having a family moving back in, that is a justifies reason for an infection of tenants' rights under current law. So that is currently a possibility. OK, no, that's good. Can I just say one last thing? Seconds, 10 seconds. All right. You're pushing your law. A vacant property tax, to me, is not the way to go. That's kind of a shtick rather than a carrot approach. And I wouldn't support that any day of the week, and I won't be, because if the house didn't fit to live in and didn't work going after, because it would be very easy to show whoever is after them that the house is not fit to live in on a certain day and there's no vacant property tax applied to the evening. OK, thanks, Deputy Henry. Thank you. Thank you.