Dáil to vote on stamp duty hike to stop cuckoo funds buying up family homes

Ministers are effectively approving a mini-budget to deter cuckoo funds from gazumping families

The Dáil is set to vote tonight on a Cabinet proposal to increase stamp duty to deter investment funds from squeezing out first-time buyers, the 'Irish Examiner' understands. Picture: Larry Cummins

The Dáil will have to vote before midnight tonight on a proposed increase in stamp duty for investment funds to deter them from gazumping first-time buyers, the Irish Examiner understands.

In what is technically a mini-budget, ministers will today approve measures that will seek to deter and limit the ability of investment funds from buying up large numbers of family homes in estates, ahead of young families.

Finance minister Paschal Donohoe is to table what has been described as a significant increase in stamp duty which, as a financial resolution, requires an immediate vote of the Dáil, as would normally only happen on budget day.

'Immediate impact'

Ministerial sources familiar with the plan told the Irish Examiner that the tax changes will have “an immediate impact” while planning changes being tabled by housing minister Darragh O’Brien will have longer-term implications.

Senior Government sources have said the increase is seen as sufficient to “act as an immediate deterrent”.

The Cabinet will also sign off on plans to ensure that up to 50% of future housing estates be reserved for first-time buyers.

Ministers will be told that the plan intends to tackle the controversial bulk sale of housing estates to investment trusts on what Government sources describe as a density basis.

The intended effect is that so-called cuckoo funds will no longer be able to bulk-buy estates that contain less than 50 houses per hectare.

This will prevent housing estates in suburbs from being “swallowed up” — but it is not intended to prevent funds from continuing to bulk-buy new apartment blocks, ultimately for rent, in large urban areas.