Leo Varadkar 'alarmed' at Ireland's low home-ownership rates

Ireland is in the bottom third in the European Union for home-ownership, a new report shows

Taoiseach Leo Varadkar has said he is 'alarmed' at the low rates of home ownership in Ireland. File Picture: Brian Lawless/PA Wire

Taoiseach Leo Varadkar has said he was “alarmed” to see Ireland in the bottom third of EU countries for home ownership in a new report.

Mr Varadkar made the comments at the Fine Gael parliamentary party meeting on Wednesday night and was referring to findings in the National Economic and Social Council (NESC) report on the private rental sector in Ireland.

The report which was brought to Cabinet also recommended changes to the regulation of the private rental sector.

Mr Varadkar told his party colleagues that he was “surprised” and “alarmed” about the findings of the report which show Ireland is behind countries such as France and Italy regarding homeownership despite 70% of Irish people owning their own home.

“We’re now in the bottom third of the EU countries in home ownership which in many ways is quite alarming to me to see that,” Mr Varadkar said.

The NESC report recommended a move to a structure like the National Car Testing (NCT) system which could be set up for rental properties to ensure they meet minimum standards.

Mr Varadkar told his party colleagues that he did not think this was a bad idea.

He also told the meeting that NESC has the view that tax breaks or fairer treatment for landlords should be considered to encourage them to stay in the system but only on the basis that tenants got stronger protection.

The Taoiseach said the government will have to make some decision on these issues in March.

Sources at the meeting also said Mr Varadkar noted the latest Daft.ie report which showed rents in the final quarter of 2022 rose 13.7% on the same period a year ago.

The Fine Gael leader said rent pressure zones have been quite effective in keeping rents down for people but the issue with high rents emerges when new properties come on the market.

He said this is probably because the landlord knows they can only put up the rent by 2% each year and that has created a real problem with the lack of supply.

The Taoiseach also said it’s clear that people are struggling more than others with the cost of living and he expects proposals to go to Cabinet on Tuesday.

He said a finance and social welfare bill may be required and the government hopes to get it all done by February 20, 2022.

However, he said there is a need to “contain expectations” and it will not be a €11bn package.

Party sources said Mr Varadkar said the government has to ensure what financial measures they announce next week will have to be enough as the government does not want to have to do something again in May or June.

Sources said the Taoiseach was “cold enough” towards keeping the VAT rate at 9% for the hospitality industry which was raised at the meeting by Senator Tim Lombard, and TDs Paul Kehoe and Brendan Griffin.