Minister for Finance Paschal Donohoe has insisted he was not lobbied by stakeholders to increase interest relief on mortgages for landlords before introducing the measure in last month's budget.
The measure in Budget 2019 means landlords will be able to offset 100 per cent of the interest they incur on mortgages or loans linked to rental properties, which is a significant increase on the current rate of 80 per cent.
Members of the Oireachtas finance committee, which was scrutinising the finance Bill on Wednesday, claimed the measure to incentivise landlords to refurbish properties would lead to an increase in evictions.
“Substantial improvements are a basis on which you can evict people and raise rents,” said Solidarity–People Before Profit TD Paul Murphy. “This is inadvertently incentivising evictions.”
Asked to inform the committee as to the lobbyists he engaged with before the budget, Mr Donohoe said: “In relation to engagements with my department, I wasn’t lobbied on this in relation to any stakeholder.”
He rejected the contention that the measures would incentivise evictions and said private landlords were needed to solve the housing crisis.
Too radical
Sinn Féin finance spokesman Pearse Doherty said the proposal was too radical to be countenanced by "even the Tories"."It's crazy stuff," he said. "Even the Tories across the water are saying the opposite. You're saying give more incentives to landlords whereas in Britain they are getting rid of mortgage interest relief.
“Landlords who were previously getting mortgage interest relief had to avail of the HAP scheme. At least there was some social good involved. The only social good in this is that landlords will have deeper pockets.”
Fianna Fáil finance spokesman Michael McGrath said the measure was a "modest step" that would help alleviate the crisis.
‘Vilify landlords’
“When you talk to landlords who have left the market it’s because of the hassle of being a landlord and because it’s loss-making,” he said. “The easiest thing in the world is to vilify landlords. We need landlords to provide supply.”
Mr Donohoe said he accepted his role in the housing crisis as a member of Government. “I acknowledge that rent levels are too high for many families and citizens across the country,” he said. “I want to see them stabilise and be affordable.”
