Focus Ireland launched a new campaign today calling for the Government legislation to fully protect homeowners and tenants in buy-to-let properties from the threat posed by vulture funds.
The campaign is called “Vulture Shock” and warns that action is needed to protect people’s homes from international investment funds that buy distressed properties to sell for a quick profit. The launch of this new campaign comes as earlier this week the Central Bank indicated that it’s not satisfied with the approach taken by the Department of Finance to the regulation of so-called vulture funds.
Focus Ireland said that the State has failed to prevent vulture funds from swooping on Irish homes as both NAMA and a number of banks have already sold off thousands of distressed properties cheaply to international investment funds. The latest figures from the Central Bank show that up to 47,000 Irish homes are now owned by such vulture funds.
Many politicians have already warned that Ireland faces a record number of evictions – and rising homelessness – unless the government takes urgent action to protect homes from vulture funds as they continue to buy up distressed properties nationwide.
Focus Ireland is calling for people to add their name to its campaign at www.bit.ly/vultureshock calling for the Government to clip the wings of these vulture funds by strengthening legislation to protect people’s family homes. The campaign also allows people to check how many properties these Vulture funds are estimated to own in each county so people can check the risk in their own local area.*
Meanwhile, Focus Ireland said that it is morally unacceptable that the Irish people bailed out our banks for €64 billion and yet these same banks are now selling off our homes to international vulture funds.
Focus Ireland Director of Advocacy Mike Allen said: “Focus Ireland is calling for Government action to stop more vulture funds swooping on Ireland for the easy profits to be made by exploiting tax loopholes and weak legislation. This serious threat to Irish homes first hit the headlines this year when a vulture fund bought an apartment complex in Tyrrelstown and tried to evict the tenants. It is shocking to realise that whether you own or rent, vultures could swoop on your home in this way.”
Focus Ireland’s Campaign is calling for the Government to take the following actions:
Limit the sale of residential debt to international funds (e.g. Stop banks selling mortgages to 3rd parties)
Close the tax loopholes to ensure that the vulture funds pay proper tax.
Remove the ‘sale of property’ as grounds for termination of a tenancy under the Residential Tenancies Act – as is the norm in many other countries.
Strengthen the Code of Conduct on Mortgage Arrears and include buy-to-let owners and tenants.
Politicians and those within the housing and homeless sector have repeatedly voiced concerns about the lack of regulation of vulture funds, and there have been numerous media reports about the use of Section 110 of the Tax Consolidation Act by vulture funds to reduce their tax bills. Recent news reports have shocked many as it was revealed that vulture funds which have spent billions buying so-called “toxic” loans in Ireland have paid as little as €250 tax here, while at the same time funnelling tens of millions to offshore entities. Officials from the Department of Finance and the Revenue Commissioners are currently investigating these claims.
Mike Allen said: “It is welcome that the State is investigating reports that these funds are exploiting tax loopholes here. However, let us not lose sight on the bigger issue. Urgent Government action is needed to stop these funds buying up distressed properties from banks or other third parties such as NAMA.”
“At the very time there are record numbers homeless in Ireland and there is concerted action by all to tackle the housing and homeless crisis it is totally unacceptable that the State is failing to provide proper protection to the thousands of vulnerable families and individuals behind these mortgages or living in buy-to-let properties.”
The Programme for Partnership Government commits to providing “greater protection for mortgage holders and tenants and SMEs whose loans have been transferred to non-regulated entities (‘vulture funds’).” Focus Ireland stressed that it is imperative that the Government acts urgently on this commitment and deliver on its promises as soon as the Dáil returns in September.
* Editors: Notes:
· Central Bank figures report 47,000 homes are owned by vulture fund – but do not provide a county-by-county breakdown. These county estimates used on the campaign website were compiled using the Census 2011 figures for Permanent Housing Units. After establishing what percentage of the total number of Permanent Housing Units were located in each county Focus Ireland calculated a county-by-county estimate showing how the 47,000 vulture fund-owned homes would be distributed nationwide. Focus Ireland is calling for more transparency about vulture funds operating in Ireland and the number of properties they own in each area.