This country-specific Q&A provides an overview to real estate laws and regulations that may occur in the Ireland.
It will cover the most pertinent issues including ownership structures, restrictions, transfers, taxes and environmental contamination.
This Q&A is part of the global guide to Real Estate. For a full list of jurisdictional Q&As visit http://www.inhouselawyer.co.uk/index.php/practice-areas/real-estate
1. Overview
Stamp duty for commercial property was increased from 2% to 6% last year for Budget 2018 however this does not appear to have had a significant impact on investment in commercial property over the past year and the Irish property market continues to perform very strongly with strong international investor demand allied to Irish REIT and institutional demand underpinning performance.
The 4% stamp duty rebate scheme that was introduced last year in respect of land purchased to develop residential property has encouraged residential development, particularly in the PRS Sector. Approximately €400 million of development land sales were completed in the first half of 2018. Co-living concepts and PRS/Build to Rent schemes are becoming increasingly mainstream, accounting for 25% of investment spend in the first half of the year, with a strong appetite to forward fund/forward commit. A major deal in this sector was Kennedy Wilson's acquisition of 247 apartments and 3.97 acres of development land at the Grange, Stillorgan, Dublin from NAMA-appointed receivers for a reported €160 million.
The introduction of a vacant site levy, in order to promote the development of vacant under-utilised sites in urban areas has led to an increase in the disposals of sites for development.
Ireland's 12.5% corporate tax rate on residential construction profits has led to an increase in the number of international investors establishing residential development companies, particularly in the Dublin area.
The Dublin office market continues to benefit from relocations due to the uncertainty around Brexit with particular growth in the serviced office sector.
The introduction of tax reforms in 2017 and 2018 which negatively impacted Irish regulated funds focused on Irish property (so called Irish Real Estate Funds or "IREFs") has led a decline in the popularity of such structures. There are now fewer tax advantages to larger non-Irish investors which has, together with the recovery of the domestic investor sector, led to an increase in the number of Irish based buyers of Irish property.
2. How is ownership of real estate proved?
The Property Registration Authority (the "PRA") is the State body responsible for the registration of property transactions in Ireland and the system of registration of title (ownership) to land in Ireland.
The main functions of the PRA are to manage and control the Land Registry and the Registry of Deeds and to promote and extend the registration of ownership of land.
The Land Registry was established in 1892. When ownership is registered in the Land Registry, the deeds are filed with the Land Registry and all relevant particulars concerning the property and its ownership are entered on folios which form the registers maintained in the Land Registry. In conjunction with folios, the Land Registry also maintains maps (referred to as filed plans). Both folios and maps are maintained in electronic form. Owners of registered real estate generally prove their title via the Land Registry folio, which is prima facie evidence of title. The legal owner of the registered property is recorded in part 2 (the ownership section) of the folio. However, mapping is not definitive as the Land Registry operate a non-conclusive boundary system.
The Registry of Deeds was established in 1707 to provide a system of voluntary registration for deeds affecting land and to give priority to registered deeds over unregistered but registrable deeds. There is no statutory requirement to register a document in the Registry of Deeds, but failure to do so may result in a loss of priority. The effect of registration is generally to govern priorities between documents dealing with the same piece of land. The primary function of the Registry of Deeds is to provide a system of recording the existence of deeds affecting unregistered property. When a deed is lodged in the Registry of Deeds it must be accompanied by the relevant application form (in a prescribed form) which is a summary of the essential information of the relevant deed. The registration of a deed in the Registry of Deeds alone is not proof of ownership. The underlying title must also be fully investigated to determine ownership.
Any unregistered property (Registry of Deeds) purchased in the State after 1 June 2011 is subject to compulsory first registration in the Land Registry. Registration is also compulsory where land is bought under the Land Purchase Acts or where land is acquired after 1 January 1967 by a statutory authority.
3. Are there any restrictions on who can own real estate?
There are no legal restrictions on the ownership of real estate in Ireland. However, anti-money laundering legislation requires that a number of checks be carried out on a potential buyer, and the identity of the buyer, the source of funds and the ability to fund the acquisition of real estate will need to be verified.
To view the full article, please click here
Originally published in The Legal 500: Real Estate Country Comparative Guide 2018
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
