Vol. 548 No. 5
323 Mr. Haughey asked the Minister for the Environment and Local Government the measures he has taken to reduce the rate of increase in house prices; the outcome of those policies; and if he will make a statement on the matter. [5472/02]
Within this Government's term of office, my Department has commissioned three major reports on the housing market with a particular focus on the supply and demand for housing. The Government responded urgently and comprehensively to the findings of these reports in "Action on House Prices (April 1998)", "Action on the Housing Market (March 1999)" and "Action on Housing (June 2000)" and has implemented a wide range of measures to reduce excessive house price increases by boosting housing output, removing infrastructural and planning constraints on residential development and discouraging speculative demand. These have included:
Targeted initiatives and the commitment of significant Exchequer funding to increase the supply of serviced residential land. On foot of these recommendations, there is currently six years supply of serviced residential land nationally and in the greater Dublin area.
The publication of planning guidelines on residential density in September 1999 to help secure efficient use of serviced development land and facilitate the provision of more affordable housing.
The introduction of a range of measures to expand the capacity of the planning system, including the appointment of additional planning staff to local authorities and An Bord Pleanála and the removal, in April 1998, of mortgage interest relief for investment in the residential housing market and higher rates of stamp duty on such investments with the aim of discouraging speculative demand taking account of more stable housing market conditions.
These measures have had a very positive effect in moderating house price increases and significantly increasing housing output. The average annual rate of house price increase has been reduced from a peak of around 40% per annum in 1998 to about 5% or 6% last year. That has allowed the Government to reintroduce mortgage interest relief for investors and to adjust stamp duty rates for investors in budget 2002. Last year was also the fifth successive year of record housing output since the Government took office. A total of 52,602 units were completed in 2001, up 5.6% on 2000. A total of 16,498 units were completed in the greater Dublin area, up 6% on 2000, the highest level of output ever produced.
