Could the compulsory purchase of vacant properties be the answer to the housing crisis? (Part 1)

Introduction

In the first of this 4-part series, Rachel Nangle considers the wider implications of a recent government announcement regarding the use of Compulsory Purchase Orders to tackle the Irish housing crisis.

A recent government announcement regarding the Compulsory Purchase Order (“CPO”) of vacant properties went relatively unaddressed and unnoticed in the news in December 2021.

As part of the Housing for All plan, implemented by Housing Minister, Darragh O’Brien, it is suggested that a CPO Programme be engaged to “… tackle vacancy in towns and villages…” in both cities and in rural communities.

Making use of the yet to be commenced sections on CPO powers under the Land Development Agency Act 2021, it is envisaged that Local Authorities and State Bodies will use funding from the Housing Finance Agency to purchase up to 2,500 vacant properties by 2026. It is intended these would be used as social housing or for onward sale to the Irish homeowner.

What is a Compulsory Purchase Order (“CPO”)

A Compulsory Purchase Order, often referred to as a “CPO”, is a notice served by a State Agency, such as a Local Authority, for the compulsory purchase of a premises or part of a premises.

While we are familiar with the concept being used for the construction of motorways, or to facilitate the expansion of the LUAS service, this is the first time the Government will attempt to implement the use of CPO’s for the purpose of obtaining property for use as residential properties, both for social housing and to sell back to public market.

Process

After a Statutory Body decides to go forward with a CPO, the owning party will be served with a notice of the CPO.  A newspaper notice will also be published and An Bord Pleanála will receive a submission for approval.

Types of CPO

A State Authority can acquire the land permanently, temporarily or, can acquire specific rights over the property / land such as easements, rights of way, or rights for service, substrata, and / or water rights.

Your Rights

While there are different procedures based on the type of CPO involved, the following rights are available to any party who has received a CPO notice:

• A right to object to the CPO
• The right to compensation based on the market value of the property
• The right to be left in the same financial position after the CPO as before the notice issued and
• A right to access Statutory Arbitration where a decision on compensation cannot be reached

Timelines apply for the right to object, and it is important to obtain legal advice as soon as Notice of a CPO is received.

How we can help

If you have any queries or concerns, or would like to discuss the above in further detail, please feel free to contact Rachel Nangle in our Commercial Real Estate Department (rnangle@bhsm.ie / +353 (0)1 440 8342).

This article is for general information purposes.  Legal advice must be obtained for individual circumstances.  Whilst every effort has been made to ensure the accuracy of this article, no liability is accepted by the author for any inaccuracies.