Written Answers. - House Prices.

Bernard J. Durkan

Question:

53 Mr. Durkan asked the Minister for the Environment and Local Government the extent, if any, to which house prices have been reduced in order to come within reach of a family on double the industrial wage; the likely impact of the affordable housing initiative on house prices in view of recent reports from the ESRI and others; and if he will make a statement on the matter. [10135/00]

The local authority affordable housing scheme involves the provision of additional houses at below market prices specifically for low-income purchasers. Eligibility under the scheme is determined,inter alia, by satisfying an income test such that in the case of a single income household gross income does not exceed £20,000 and in the case of a two income household, such that two and a half times the gross income of the principal earner plus once the gross income of the subsidiary earner does not exceed £50,000. The scheme is a targeted initiative designed to provide additional new houses at affordable prices and less than the market prices in the area. It complements the existing shared ownership scheme under which local authorities also make available houses for sale to low-income house purchasers.

The provision by local authorities of new houses for sale to low-income house purchasers under either the affordable or shared ownership scheme should, apart from benefiting the purchaser, also assist in moderating house price increases in the area. The Deputy will appreciate that average house prices reflect transactions in all sectors of the market and that typically prices paid by first time buyers are some 25%-30% less than average house prices.