Michael Noonan promises site levy will stop land ‘hoarders’

Finance Minister Michael Noonan has pledged that delayed legislation for a vacant site levy will force developers who hoard land to build houses or sell on the sites.

He made the comments after Nama chief executive Brendan McDonagh accused developers of deliberately “hoarding” land and stalling building homes to benefit from soaring house prices.

Brendan McDonagh said only a small fraction of the residential sites Nama has sold to developers since 2010 for housing have actually been built on.

Mr McDonagh was speaking to reporters alongside the outgoing finance minister and Nama chairman Frank Daly at the presentation of Nama’s 2016 report.

Mr McDonagh said the agency had monitored the sites it sold for housing development after claims there was not enough residential land available to build on. The sites could support 50,000 housing units but only 3,200 units, or 6% of the total, had been built on or were in the process of being built.

“A lot of people ask what is the reason for that. There is clearly some infrastructural issues,” he said, but added that, with house prices rising strongly, site values were soaring. “By hoarding land, you actually pick up the increase in value without actually doing very much to it. So effectively, that’s a huge issue in my book,” Mr McDonagh said.

The benefits to developers waiting to start building were clear. “The maths are very simple,” he said.

Asked whether developers hoarding land should be “named and shamed”, Mr McDonagh said he wanted to establish the reasons sites were not being developed for the country’s growing population.

Mr Noonan said that legislation to stop developers hoarding land had to be delayed on legal advice but that plans to introduce the levy could go ahead because owners had now been given an adequate notice period.