Written Answers. - House Prices.
Eamon Gilmore
Question:
56
Mr. Gilmore
asked the
Minister for the Environment and Local Government
the latest information available to his Department on the percentage increase in new and second hand houses in Dublin and the rest of the country; the steps, if any, he will take to control the price of houses in view of the evidence that the Bacon report is not having the desired effect; and if he will make a statement on the matter.
[19358/98]
Seán Haughey
Question:
74
Mr. Haughey
asked the
Minister for the Environment and Local Government
the plans, if any, he has to introduce additional measures to reduce house prices for first time buyers, particularly in the Dublin area; and if he will make a statement on the matter.
[19304/98]
I propose to take Questions Nos. 56 and 74 together.
The latest comprehensive information available to my Department on house prices is contained in My Department's Housing Statistics Bulletin for the June quarter, 1998, copies of which are available in the Oireachtas Library. The price levels reflected in the June quarter figures would, generally speaking, have been determined before any effects from the implementation of the Action on House Prices which was announced by the Government at the end of April.
It is still too early for a detailed assessment of the effects of the measures adopted by the Government and indeed, the full effect of some measures will only be seen in the medium term, particularly those designed to promote housing supply. However, the evidence available indicates that the measures already in place are, in fact, having a positive effect: there are indications from lending agencies and market sources of an easing of the house prices situation, first time purchasers reclaiming the market which had been increasingly dominated by investors, more second hand houses on the market as a result of stamp duty reductions, fewer properties exceeding their asking price and a general calming of future price expectations. I would hope to see these trends reflected in the official figures for the second half of the year.
Ongoing implementation of the Government's Action on House Prices is a priority for my Department in order to ensure that all of the measures have maximum effect as quickly as possible. In particular, measures to secure continued increase in the supply of housing will be a key factor. Considerable progress is already being made in this regard. The record level of housing output in 1997 is expected to be surpassed again this year, with completions likely to exceed 40,000. These upward trends in housing output will be boosted by the effect of the measures in Action on House Prices in particular, the significant additional Exchequer funding for water, sewerage and roads infrastructure specifically to open up extra land for housing.
Planning authorities have been advised to promote higher residential densities at appropriate locations and arrangements are proceeding for the development of planning guidelines in this regard. The reduction in capital gains tax from 40 per cent to 20 per cent for the next four years, to encourage faster sales of land with planning permission for housing, is also helping to increase the supply of land for housing in the medium term.
I believe that the elements of the Government's Action on House Prices that are particularly designed to assist first time house buyers such as the major reductions in stamp duty, removal of investor competition, increased supply of housing and improvement to the local authority shared ownership scheme, will be seen to have increasing beneficial effect in Dublin and elsewhere in the period ahead. My Department will be monitoring developments carefully in this regard.
