€75,000 to quit estate sold to charity by Nama

A proposal to increase the compensation to homeowners after Nama sold the majority of their estate for social housing has been shot down by the Department of the Environment.

Residents of the Oakley Wood estate in Tullow, Co Carlow, have been told there will be no increase to a €75,000 buyout offer tabled by Respond, a voluntary housing association, if they wish to move.

Respond recently spent €2.5m to buy 55 homes in the estate from Nama, with funding from the department, valuing each house at just over €45,000. It is a pilot scheme that will be used for 47 other unfinished estates across the country.

The department confirmed an informal proposal was put to it, involving Carlow County Council topping up the offer put forward by Respond.

However, the department said it “expressed its significant concerns with the principle of such a proposal particularly in terms of policy... and the potential for undue interference in the housing market”.

The proposal would have involved the council buying the homes of a small number of original owner-occupiers for up to €95,000 and selling them to Respond for €75,000.

It was an informal proposal and the council has denied it had any role in it.

The owner-occupier residents in the estate argued the €75,000 deal devalued their properties because they are no longer attractive to any buyer other than one involved in social housing.

The points put forward suggested that the mix was incompatible with future attempt the owner-occupiers might make to sell their home to a private buyer.

Individual homeowners told Respond, Carlow County Council, and Environment Minister Phil Hogan that an excessive devaluation of their properties could also affect their standing with their banks.

Respond said it was bound by the Charities Act not to overpay for the properties and had offered to meet with individual lenders and provide the services of a financial adviser.

Respond has confirmed it has offered existing residents up to €75,000 each to buy the entire estate. It said this offer is still on the table.

“Respond again wrote to the owner-occupiers in April 2013 reiterating the offer of €75,000 per unit if the owner/occupier wished to dispose of their house to Respond,” said a spokesperson for the association.

“At all times the owner-occupier were informed they were welcome stay on and become part of the community at Oakley Wood.”

Respond’s offer is a significant drop on the original asking price of the estate when it was first built.

It also is less than half the amount Nama was seeking from perspective buyers when it looked to sell the houses individually.

However, Fine Gael TD Pat Deering, who petitioned the council on the residents’ behalf, said it was shot down by the department because it would set a precedent for other estates.

The council said it was not involved in any direct negotiations with residents or the Department of the Environment.