Lisney has prepared a pre-Budget submission for the government in which it suggests a number of initiatives relating to the residential and commercial property market.
Prior to setting out its recommendations, Lisney acknowledged some of the more positive measures implemented by the government in the last two years. In particular, reducing stamp duty on commercial property to 2%, introducing a CGT waiver on investment properties bought before the end of 2013 and introducing and implementing REIT legislation, all of which have had very positive effects on the property market.
This is particularly evident in the investment sector, where activity levels in the first six months of the year were the strongest since 2006. For 2013 as a whole, Lisney anticipate that investment market turnover will reach €1.2 billion. Whilst it is unlikely that this level of activity will be emulated next year, Lisney believes that these measures have kick-started a market that saw virtually no activity in the previous two years.
Lisney now hope that further stimulatory actions will be considered by the government. Its recommendations are as follows:
1. Remove the additional costs imposed on private residential landlords by reinstating 100% mortgage interest relief, levy the occupier rather than the landlord with the Local Property Tax and do not subject rental income to PRSI and the Universal Social Charge.
2. Over the coming years (up to 2016) put in place a mechanism for an alternative Local Property Tax system that is more equitable, particularly for those who live in city areas.
3. Provide additional basic information on the Residential Property Price Register about properties sold and give consideration to providing a map-based option to view the data.
4. Improve the accuracy of data provided on residential property prices by tracking the entire market and not just the section of the market funded by mortgages.
5. Do not impose any form of levy on vacant plots of development land and progress other solutions.
6. Put in place commercial rates waivers and/or abatements for a five year period for targeted high streets.
7. Set up a new fund to finance the targeted development of residential and commercial schemes.
8. Put in place various initiatives to promote residential development in city areas where demand exists.
- Provide development finance for residential schemes in locations where demand exceeds supply.
- Direct, through the Department of Environment Heritage and Local Government, various local authorities to put in place targeted reductions in development contributions and request further analysis of existing density requirements.
9. Put in place targeted development finance for the office sector in Dublin city centre where capacity constraints are evident.