Westmeath’s councillors see housing as the biggest challenge for 2014, with one councillor predicting a housing shortage as “an explosion that’s about to happen”.
There are not enough houses to meet Westmeath’s housing need for private tenants or the 1,718 people on the housing list. Rents are increasing, putting pressure on private tenants, and on the Rental Accommodation Scheme (RAS ) operated by the council.
Speaking at this week’s county budget meeting Cllr Mick Dollard, who chairs the Housing SPC of Westmeath County Council was first to express concern about the RAS private rental scheme which matches tenants with landlords and guarantees a rental payment.
He said the council, which has 374 RAS tenants is too reliant on RAS and urged the council to buy secondhand houses, while Cllr Aidan Davitt urged a public private partnership to build houses.
An estate agent, Cllr Davitt said that where the council pays a rent of €510 per month to a landlord in the RAS scheme, a two-bed house in a reasonable part of Mullingar can earn €500 and a three-bed semi in an average area commands €600-650 per month.
“The figures don’t stack up,” he said, predicting that the number of people on the RAS will fall rather than increase in 2014 as landlords seek more profitable arrangements.
Cllr John Shaw said the rental market is going against the council and he was concerned about the difference between what the tenant and the council pay.
“There’s ground to be made up in the cost of €72 per week,” he said after hearing that out of the average €118 weekly rent paid to a landlord, just €46 is paid by the tenant.
Cllr Kevin ‘Boxer’ Moran said many landlords are terminating their RAS contracts because they see an opportunity to make more money and he said he didn’t blame them because many have huge mortgage repayments.
While Cllr Ken Glynn pointed out that RAS allows people to be housed more quickly than otherwise, he said there’s room for improvement.
Cllr Paddy Hill said there are an alarming number of repossessions predicted and those people will have to be rehoused.
“We need to be prepared,” he said.
Acting county manager Barry Kehoe agreed that housing will be the major issue for the coming year and said it is critical that the council starts building houses as there won’t be enough to meet needs and the current housing prices will increase.
“It has to become commercially viable for someone to build houses,” he said.
Cllr Frank McDermott was also critical that there is no help in the Local Property Tax legislation to allow councils reclaim the property tax from their own tenants.
“I’ve paid mine and I’m subsidising 1,285 local authority houses who’ve paid nothing,” he said, adding that the legislation prevents the council even taking €2 per week from tenants.
“It’s unfair,” he said, in view of the €115,650 property tax cost to the council in 2014.