The state’s latest mortgage-to-rent initiative, under which private company ‘Homes for Life’ would buy up distressed mortgages, and lease the relevant properties back to the council, has come in for attack.
Cllr. Éilis Ryan said of the scheme:
“This is a ludicrous financing arrangement under which the state will effectively pay the full outstanding mortgage on each property, and possibly more, but a private company will own the house at the end of the day.
“Under the scheme, when a distressed mortgage is bought by ‘Homes for Life,’ the private company will be almost fully reimbursed by way of a long-term leasing arrangement between the city council and the company. This makes no sense except for the company’s bottom line.”
The councillor continued:
“This would have been an ideal opportunity for the state to expand its housing stock. It owns AIB, for example – so it owns many of these distressed mortgages already.
“Bringing these homes into its own stock, without an intermediary, would achieve exactly the same outcome for distressed mortgage-holders, but with the state increasing its stock of public housing for the next generation, in the process.”
The Councillor concluded:
“I’m calling on the government to reverse its approval of the new scheme, and instead, via its position as majority shareholder in AIB, arrange a structured payment deal with AIB to take these properties into council ownership, and rent them to the existing mortgage-holders.
“The cost would be almost identical, but the state would expand its housing stock by thousands of units.”