25,000 houses vacant due to complex Fair Deal valuation system

The Fair Deal scheme needs to be overhauled, said Independent TD Denis Naughten. File Picture: Gareth Chaney/Collins

Up to 25,000 homes owned by people living in nursing homes are not rented out every year due to the complex valuation system in place, the Oireachtas health committee has heard.

The Nursing Homes Support Scheme (Amendment) Bill 2021 is currently before the Dáil. The bill covers how people who use the scheme — known colloquially as the Fair Deal — have assets valued for financial contributions to care.

The scheme costs €1.4bn annually, with income from sales only providing €350m of this, Minister of State for Older People Mary Butler said.

Independent TD Denis Naughten raised concerns around how rental properties are valued.

A complex valuation scheme factors in the market value of the property, gross rental income, and that income, when considered as capital. Mr Naughten contrasted this with a simpler system used by the Department of Social Protection.

What's your view on this issue?

You can tell us here

Changing systems would, he said, remove “a barrier to the renting out of up to 25,000 family homes" across the country. 

He called for swift action as the bill has taken six years to get to this stage and a further delay could see tens of thousands more properties left vacant.

Social Democrats co-leader Roisin Shortall supported Mr Naughten’s position. She said families often raise this problem with her. 

She notices empty properties with a handrail or wheelchair ramp outside while campaigning at election time.

It is madness that we are leaving thousands of houses vacant, thousands of good quality houses vacant simply because the Department hasn’t been able to find a way of dealing with this equitably and fairly.

Ms Butler said: “No-one on the scheme will pay more than the cost of their own care; that has to be recognised.” 

She said she understands the problem, but there are also concerns older people might be placed in nursing homes sooner than expected if legal guarantees around use of their property are not clear.

An amendment to remove "the disincentive" to sell is currently with the Attorney General, she added.

However discussions with the Department of Housing still continue on the rental issue, she said.

Independent TD Danny Healy-Rae said farmers and small business also continue to have concerns about how transfer of ownership and succession is dealt with under the bill.

This was also raised by Fine Gael TD Colm Burke.

He called for clarity around cases where the farm ownership was transferred sometimes in tragic circumstances very shortly before the original owner enters a nursing home.