Government's proposed tenant in-situ scheme

[Sarenco]

The idea that a landlord has to offer first refusal to buy to their tenant has been suggested by the Green Party.
How do they think this stuff up ?
Do they want every tenant in the country evicted on 1st April ?
Is such a suggestion constitutional ?

Just heard Eamon Ryan on the radio say that the cabinet has agreed that tenants will have a right of first refusal where the landlord is selling up.

When asked when that would take effect, the Minister said from 1 April 2023.

A rather bemused Bryan Dobson asked whether he expected to have passed the necessary legislation by 1 April?

In response, the Minister insisted that no legislation is required!

You really couldn’t make it up.

 

[Sarenco]

Here’s a report of Bryan Dobson’s interview with Eamon Ryan -

Govt set to win vote on end to no-fault eviction ban

The Government looks on course to win tomorrow's Dáil vote on ending the no-fault eviction ban.

www.rte.ie

How could the creation of a right of first refusal not require legislation?

By decree of the good Minister?

 

[NoRegretsCoyote]

How could the creation of a right of first refusal not require legislation?

By decree of the good Minister?

it's real back-of-the-fag-packet government.

You only need legislation where a tenant is willing and able to buy and a landlord is not willing to accept market price from a tenant, see matrix below.

	Tenants not able to buy	Tenants willing and able to buy
Landlords willing to sell at market price to tenant	Legislation irrelevant	Legislation not needed
Landlords not willing to sell at market price to tenant	Legislation irrelevant	Legislation needed

I'll wager the number of cases in the bottom right annually could be counted on one hand.

 

[Purple]

it's real back-of-the-fag-packet government.

That's a great description. I'll use that one.

 

[Sarenco]

You only need legislation where a tenant is willing and able to buy and a landlord is not willing to accept market price

But who determines market price?

It has always been open to tenants to put an offer to their landlord and it’s always been open to a landlord to accept or reject that offer.

I assume tenants would now be given a right to call for a third party valuation and a right to purchase at that valuation.

Otherwise, what new “right” is being created?

 

[RonnieShinbal88]

These new proposals might effectively be an extension of the eviction ban because all of the red tape required to ascertain if the tenant can afford to buy (including mortgage approval delays?), getting them in a position for first refusal, entering them on one of the affordability schemes if they can't get a mortgage etc. will take forever. Especially given the backlog of eviction notices. If government regulations result in overholding of a 6 month notice period by design are they legal? Can the owners right to sell in e.g. 6 months be overridden by ministerial decree without an eviction ban?

 

[Greenbook]

These new proposals might effectively be an extension of the eviction ban because all of the red tape required to ascertain if the tenant can afford to buy (including mortgage approval delays?), getting them in a position for first refusal, entering them on one of the affordability schemes if they can't get a mortgage etc. will take forever. Especially given the backlog of eviction notices. If government regulations result in overholding of a 6 month notice period by design are they legal? Can the owners right to sell in e.g. 6 months be overridden by ministerial decree without an eviction ban?

My thoughts exactly! If the tenant can't afford to buy they go into some cost rental scheme where the local council buys. I can only just imagine how long that will take. How they think all this is going to encourage landlords in to the market is beyond me.

 

[NoRegretsCoyote]

It has always been open to tenants to put an offer to their landlord and it’s always been open to a landlord to accept or reject that offer.

Exactly.

It would be a capricious or foolish landlord who would not accept an offer from a sitting tenant consistent with what he'd been advised that he'd get on the open market.

There will be a whole administrative apparatus put in place now to force landlords to make offers to tenants the vast majority of whom will have no interest in buying.

 

[Greenbook]

Exactly.

It would be a capricious or foolish landlord who would not accept an offer from a sitting tenant consistent with what he'd been advised that he'd get on the open market.

There will be a whole administrative apparatus put in place now to force landlords to make offers to tenants the vast majority of whom will have no interest in buying.

and the whole thing can be endlessly delayed while the 'interested' tenant trys to get a mortgage, tries to get the local Council to buy the property etc. etc. This just seems to be a stealth eviction ban.

Again, how this will attract landlords in to the market is beyond me

 

[Right Winger]

The Irish Times is now directly contradicting Ryan and confirming what we all knew - legislation WILL be required to give effect to a right of first refusal. What a clown!

Cabinet agrees to ‘safety net’ for renters from April 1st

Green Party politicians voice concerns on ending eviction ban, but sources say a number of measures agreed including council purchases of homes as social housing

www.irishtimes.com

"However, the “first refusal” option, which will mandate that renters will be given the first chance to bid on their home if it is being put up for sale, will need legislation and will be come in later. This is contrary to comments from Mr Ryan. who earlier told reporters that this could be done on an “administrative basis”. Those availing of this option will also be able to claim back up to 30 per cent of the purchase price of their home using the First Home scheme, he said."

 

[Sarenco]

Those availing of this option will also be able to claim back up to 30 per cent of the purchase price of their home using the First Home scheme, he said."

I don’t understand this comment.

To be eligible for the First Home Scheme the property must be a newly built house or apartment.

By definition, an existing rental property cannot be a newly built house or apartment.

Is the State going to create a shared equity scheme for properties in the second hand market?

The Government really does seem to be at sea at the moment.

 

[Right Winger]

I don’t understand this comment.

Well, the quote is attributed to Ryan, so I wouldn't really expect it to make sense.

To be eligible for the First Home Scheme the property must be a newly built house or apartment.

By definition, an existing rental property cannot be a newly built house or apartment.

Is the State going to create a shared equity scheme for properties in the second hand market?

Maybe it will. Possible also that the Help-to-Buy scheme - which can be combined with First Home - will be extended to the second have market.

The Government really does seem to be at sea at the moment.

They're looking for fig leaves to cover Eamonn Ryan's embarrassment at having agreed to end the eviction ban. Quite a small fig leaf will do nicely.

 

[Marsupial]

Here’s a report of Bryan Dobson’s interview with Eamon Ryan -

Govt set to win vote on end to no-fault eviction ban

The Government looks on course to win tomorrow's Dáil vote on ending the no-fault eviction ban.

www.rte.ie

How could the creation of a right of first refusal not require legislation?

By decree of the good Minister?

Is it possible that what Ryan intended to say was that the change could be implemented by secondary legislation. i.e. Statutory Instrument, rather than requiring an amendment to the primary legislation? (I don't know whether that's possible, but maybe that's what was in his briefing note, which he didn't understand!)

 

[Sarenco]

Is it possible that what Ryan intended to say was that the change could be implemented by secondary legislation. i.e. Statutory Instrument, rather than requiring an amendment to the primary legislation? (I don't know whether that's possible, but maybe that's what was in his briefing note, which he didn't understand!)

I very much doubt it.

I’m not aware of any primary legislation that would give the Minister the power to create this new “right” by way of a statutory instrument.

To be honest, I think he was just very poorly briefed before he went on the show.

He wasn’t even able to give a reasonable estimate how much these newly announced measures are going to cost the State.

Making big policy decisions on the hoof to head off political opposition is always a recipe for disaster. Just look at the RPZ regime…,

 

[Sarenco]

Maybe it will. Possible also that the Help-to-Buy scheme - which can be combined with First Home - will be extended to the second have market.

I see RTE are now reporting that the First Home Scheme will be extended to cover purchases in these circumstances.

So, apparently the State is going to extend a shared equity scheme to second-hand properties.

How that promotes new housing supply - which is what we need - is beyond me.

The level of State subvention in the private residential property market seems to be escalating…

 

[NoRegretsCoyote]

How that promotes new housing supply - which is what we need - is beyond me.

Secondhand houses and new houses are not perfect substitutes, but not far off.

If the state bought up tens of thousands of existing houses the owners would use the proceeds to stimulate housebuilding. It's probably not the most efficient way of doing it but more housebuilding is the objective.

People get tied up in knots on the distributional stuff but "more new dwellings" really is a panacea.

 

[T McGibney]

If the state bought up tens of thousands of existing houses the owners would use the proceeds to stimulate housebuilding. It's probably not the most efficient way of doing it but more housebuilding is the objective.

There's no evidence whatsoever that the many thousands of owners who have sold in the past few years have used any of the proceeds "to stimulate housebuilding" or to return to property investment in any form. Most of the ones I've met are relieved to have escaped the madness

 

[mct1]

A couple I know are living abroad and have decided to stay there. They've been renting out three separate apartments in their home here and gave notice to the tenants because they want to sell the house in June to other friends of ours - a mutual agreement has been reached but no contract until the tenants all depart, assuming they do.

So now what happens? Must they offer the house to all three tenants? Unlikely, but what if they all wanted to buy it? What about our friends who are all organised to move in this summer having put their house up for sale? The more I hear about this 'solution' to the housing problem the crazier it sounds.

 

[Sarenco]

Yep, it all sounds like a good idea until you stand back and think about it for a second.

Daft laws chasing even dafter laws.

 

[Mocame]

Local authorities raise concerns that the tenant in situ scheme competes with first time buyers:

Government tenant-in-situ schemes competing with first-time buyers, local authorities warn

Tenant-in-situ schemes operated by city and county councils are competing with first-time buyers, local authorities will warn TDs and Senators.

www.independent.ie