I move amendment No. 1:
To delete all words after “Dáil Éireann” and substitute the following:
“acknowledges the extensive range of measures included in the Programme for Government - Our Shared Future, building on the initiatives already undertaken and in progress, which will be brought forward to support individuals and families to access affordable housing and, in particular, notes that:
— this Government has confirmed its overarching housing policy principle that everybody should have access to good-quality housing to purchase or rent at an affordable price, built to a high standard, and located close to essential services, offering a high quality of life;
— this Government believes that the provision of more affordable housing has a profound benefit socially and economically, and that the State has a fundamental role in enabling the delivery of new homes and ensuring that best use is made of existing stock;
— building on the progress made to date, this Government is also committed to supporting the delivery of homes through the Serviced Site Fund, the Local Infrastructure Housing Activation Fund, the Rebuilding Ireland Home Loan and the Help to Buy scheme;
— under the Serviced Site Fund, local authorities have indicated they will deliver 3,200 new affordable homes across 35 projects already approved;
— consistent with the National Planning Framework and the Building Control Reform agenda, this Government is committed to the delivery of quality homes and a planning
system that delivers homes in a strategic manner to meet the demands of a modern society; and
— the Residential Tenancies Board published a report in June 2019, prepared by the Economic and Social Research Institute, which shows that Rent Pressure Zones are having a moderating effect on rent price inflation to the magnitude of 2-3 per cent per annum; and
further notes the Government’s intention to:
— embed affordability at the heart of Ireland’s housing system;
— prioritise the increased supply of social and affordable homes;
— finalise and open a State-backed affordable home purchase scheme to promote home ownership for households that would otherwise be frozen out of the market;
— increase the social housing stock by more than 50,000 homes, with an emphasis on new builds, to ensure that those in the greatest need can access quality housing and to take pressure off other areas of the housing system thus ensuring more affordable supply for first-time buyers and renters;
— create the conditions for the delivery of the greatest number of affordable homes possible, including setting a target for the delivery of affordable homes over the lifetime of the Government, to be available for qualifying purchasers as a matter of priority;
— accelerate delivery of affordable homes by local authorities under the €310 million Serviced Sites Fund, to deliver 6,200 new affordable homes and expand the projects under the Fund and examine opportunities to expand the scope and potential of the Fund;
— ensure that local authorities remain central to delivering public social and affordable housing working with approved housing bodies, the Land Development Agency (LDA) and other state and private sector partners;
— work with the private sector, through the planning and regulatory regimes, to ensure that an appropriate mix and type of housing is provided nationally and locally;
— monitor and work to address, with key stakeholders and industry, issues arising in the area of construction costs, viability and productivity, particularly against a background of Covid-19 and Brexit;
— improve the supply and affordability of quality rental accommodation and the security of tenure for renters;
— recognise the need to re-invigorate our towns, put in place a new scheme to provide seed capital to local authorities to provide affordable serviced sites in towns and villages to allow individuals and families build homes;
— retain and expand the Help to Buy scheme for new properties and self-build properties;
— expand the Rebuilding Ireland Home Loan;
— expand Part V of the Planning and Development Act 2000 to encompass affordable as well as social housing;
— roll out the cost rental model for the delivery of housing that creates affordability for tenants and a sustainable model for the financing, construction and management of homes;
— complete the audit of State lands, identifying land banks in public ownership that are suitable for housing and other purposes;
— mandate the LDA to work with local authorities, State agencies and other stakeholders to develop masterplans for strategic sites; and
— avoid over-concentration of particular housing types in areas, by requiring local authorities to complete Housing Need Demand Assessments to inform the delivery of an appropriate mix of housing typologies to cater for the needs of disparate household types and sizes."
I thank colleagues for tabling this motion as it affords me an opportunity to outline my plans to deliver affordable and public housing. The Government is opposing the motion as it is flawed, poorly constructed and ill-thought out. In the amendment, the Government makes clear, at we have laid out in Our Shared Future, the programme for Government, that its actions will be guided by the core principle that everybody should have access to good quality housing to purchase or rent at an affordable price in sustainable communities that offer a high quality of life.
Tackling homelessness remains a key objective. I met the incredible team in the Department today to reinforce that message and offer any support I can. Accelerating the delivery of social housing, with an increased emphasis on direct build, is a key objective in the programme for Government, which contains an ambitious target of delivering at least 50,000 social housing homes over the term of the Government. Another key objective is to deliver affordable homes for people and families to be able to purchase or rent. In particular, I will bring forward measures to give hope back to our young people that they can aspire to own their own home at an affordable price.
I have spent my first ten days in office meeting key stakeholders and gaining further insights into the challenges that lie ahead. I have outlined the ambitions of the Government in the key areas of housing and homelessness and I have asked them to be as ambitious in their pursuit of delivering the homes that we badly need. I am meeting key delivery partners weekly, initially to target delivery this year, taking account of the challenges presented by the Covid-19 pandemic. I will also work closely in partnership with local authorities, approved housing bodies and the Land Development Agency to plot the course ahead and to agree output targets.
Affordable homes will be delivered through a number of channels. To this end, my intention is to extend the serviced sites fund, SSF; expand Part V to encompass affordable purchase as well as social housing while protecting the 10% social housing provision; and to provide seed capital to local authorities to provide serviced sites at cost in towns and villages to allow individuals and families build homes.
I want to expand the Rebuilding Ireland home loan, strengthen the mortgage-to-rent scheme and ensure it is helping those who need it and those who are in systemic mortgage arrears. I want to retain and expand the help-to-buy scheme for new properties and for self-build properties.
I am going to accelerate and expand the serviced sites fund. Under the fund €310 million is already available to provide enabling infrastructure to support the delivery of more affordable homes on local authority lands. A maximum funding amount of €50,000 is available per home and on this basis and under the existing budget at least 6,200 affordable homes to buy or rent can be delivered. The funding is made available in those areas where local authorities have demonstrated a requirement for more affordable housing and that the viability for delivering such housing on their sites exists. Some €127 million of the serviced sites fund has already been allocated in support of 35 projects. I will ensure that these projects are expedited so that these homes will be delivered. This will provide for critical infrastructure work that will support delivery of almost 3,200 affordable homes across 14 local authority areas, including the greater Dublin area, Cork, Limerick and Galway, seeing good a firm commitment outlined in the programme for Government.
Importantly, the majority of these homes are being developed across mixed tenure sustainable sites. The bulk of these projects, approved for funding under the serviced sites fund, are currently in the planning and design phase. The final sales prices of these affordable homes will be fully determined after the necessary planning permission has been obtained and the procurement process for the construction of the development in question has been completed. Local authorities have, however, projected indicative reductions of between 10% and 40% on open market values. I am determined to work with them and support local authorities and other delivery partners to ensure that these homes are affordable for the people and families that need them.
For example, in early 2021, a development in Boherboy, County Cork, is scheduled to be the first serviced sites fund scheme to deliver homes. It will deliver 116,000 badly needed affordable homes and Cork County Council has confirmed that these two and three-bedroomed homes are expected to be made available to first-time buyers between the price range of €198,000 and €223,000.
Just yesterday, South Dublin County Council issued an invitation to tender for the development of a supported project in Killinarden in Tallaght. The development site has an estimated capacity for 500 units with an anticipated tenure mix of 60% affordable and 20% social. Fingal County Council will shortly award a contract and commence construction on a housing project in Dun Emer in Lusk comprising two and three-bedroom houses and apartments which will be offered to the local authority with an average reduction of 20% on market values. Indeed, I have met Fingal County Council specifically about those 51 homes where the prices will range on or about €200,000.
We need local authorities to bring forward many more of these type of projects and this is the message I have given in my letter to chief executives late last week. For my part, as Minister, I will ensure that the necessary budgetary and statutory supports are in place. I intend to continue to use the finance provided by the serviced sites fund to support the delivery of more affordable homes on public land. I also intend to extend the use of the serviced sites fund and will be working with local authorities to that end. I am also looking at other potential ways to expand this fund to deliver more affordable homes in the shortest possible time.
Another important way in which I will be encouraging the development more affordable homes is through the expansion of Part V planning provisions. I intend to extend Part V to encompass affordable purchase in addition to its current important role in providing social homes. This commitment will not only add to the number of homes available in these areas but will increase the tenure options for people and will assist in providing a good tenure mix within our communities.
The Sinn Féin motion calls for absolute limits on the selling of affordable homes. It also places limits on the gross incomes of those who will be eligible to buy those affordable homes. These ideas, while well-intentioned, are flawed and not ambitious enough. On selling prices, the price of the homes that will be made available for purchase under the affordable scheme will be influenced by a range of factors which will vary from scheme to scheme. I will be working to make them affordable and attractive for people who need them, particularly in major of urban areas where people are facing the greatest access and affordability challenge.
Placing absolute and uninformed limits on the prices of as yet to be planned, procured and constructed homes could easily become a barrier to delivery. This could prevent the development of viable housing in areas of most need or prevent households identified as having a particular housing need from accessing the type of house in the location in which the house is needed.
The Government will not support the Sinn Féin position that households on gross income of more than €75,000 would be deemed unworthy of State support. This would represent something in the region of 40% of dual income households nationally and a significantly greater number of dual income couples in our urban centres. The approach this Government favours is proportionality. We do not intend to define affordability, as the Sinn Féin motion suggests, by reference to single points of income or price. If one takes the example of the median price of a first-time buyer home in 2019 in Dun Laoghaire-Rathdown which was €465,000, or Dublin city where it was €343,000, is Sinn Féin really saying that a dual income working couple earning average wages just over the threshold of €75,000 and unable to buy a more affordable home in their own community would be excluded from availing of support to purchase a more affordable home under any Government scheme?
Affordability is not simply a question of how much is too much to pay on a mortgage but of how much is too much for whom and in what circumstance? That is why this Government would rather seek to try to accommodate each household’s particular family need and financial circumstance. It is why, in the first part, we will assess eligibility on the proportion of the net income a household would need to buy a house on the open market to meet their needs. The Government will ensure a balanced allocation of State supports both in terms of fairness regarding those who are eligible to avail of it, and on the amount of financial support they receive.
In addition to ensuring that local authorities will be central to delivering housing, the Government has also confirmed that the Land Development Agency, LDA, will have a crucially important and increasing role in the delivery of more affordable homes on State-owned land. This will include homes for affordable purchase, cost rental and social housing. As stated in the programme for Government, we will legislate as a matter of urgency to establish the LDA on a statutory basis to ensure State-owned lands are properly managed and utilised. The LDA will be tasked to work with Government Departments, local authorities, State agencies, and other stakeholders to assemble strategic sites in urban areas, and to ensure the sustainable development of social and affordable homes for rent and purchase. We intend that State lands being offered for sale, whether owned by a local authority, Government Department, commercial or non-commercial State agency, or any other agency, would automatically be offered first to the LDA.
I will also continue to encourage housing delivery supported by the local infrastructure housing activation fund, LIHAF. LIHAF was designed to fund the provision of large-scale public infrastructure to relieve critical blockages and enable housing developments to be built. Funding of €200 million has already been allocated under LIHAF and the projects will support the delivery of up to 20,000 homes. Construction of infrastructure and housing has started on many projects and more than 2,000 homes were completed to the end of 2019. About 40% of homes delivered under LIHAF will be sold at rates which provide a discount on market price. Up to 3,000 will be social housing homes and the remainder will be sold at market rates.
I have committed to introducing an affordable purchase scheme as a matter of absolute priority. It was with some interest that I read this Sinn Féin motion calling for the introduction of such an affordable housing scheme. I remind the House that Sinn Fein opposed and voted against a Fianna Fáil motion to build affordable housing on State and local authority lands in the last Dáil. It is a late convert to the principle of affordable purchase. I welcome the party’s conversion to affordable purchase.
I intend to announce the details of the new scheme in September, when I will confirm the arrangements under which discounted homes will be sold to eligible purchasers by local authorities. The underlying provisions for affordable purchase are set out in Part V of the Housing (Miscellaneous Provision) Act 2009.
In finalising the details of this scheme, I am first taking a short amount of time to engage with the various sectoral interests to ensure the scheme is as I envisage and as envisaged by Government. I have instructed my officials to undertake a short and focused review of the 2009 provisions to ensure they meet those requirements and to identify the changes that will be necessary to reflect the priorities of this Government. Key eligibility criteria for an affordable dwelling purchase arrangement under Part V include that the applicant be a first-time buyer, with exceptions, that the net household income is such that the repayments on a 90% mortgage for the purchase of a suitable unit at market value would not exceed 35% of that net income. Net income here means income net of income tax and PRSI. In addition, a charge will be placed on the property equal to the percentage discount from market value, giving the housing authority an equity stake in the property. This is important to ensure that more homes can be delivered over time, helping more people to access affordable homes.
While I consider that 35% is a reasonable threshold, as I have indicated earlier, I intend to scrutinise the eligibility criteria as it relates to income level to ensure it reflects this Government's priorities and delivers the outcomes we need. Broadly, I consider that determining eligibility by reference to net income is fairer than doing so by reference to gross income. Take, for instance, two couples with the same net income, the first couple with one income and the second couple with two incomes. The couple with one income in this case will have a higher gross income. I do not believe two households with the same net income, which influences the ability to repay a mortgage, should necessarily be treated differently because their gross incomes may be different. However, as I have said, I intend to take a close look at this area before finalising the scheme. I further intend to publish that scheme in September, along with any amending legislation that would be required.
As Members will know, we are also preparing a cost rental model, a national cost rental scheme in respect of which a working group is finalising options for Government. This will also be published this year and brought before this House.
My tenure as Minister will see affordability at the heart of the housing system. My immediate priority in this area will be concentrated on introducing an affordable purchase scheme that will help struggling households access affordable homes. I am very much aware of the breadth of the task that is facing us in this area and I am determined to take on this challenge. I am confident the extensive range of commitments our three parties have made in the programme for Government will prove to be an excellent starting point for our collective ambition to make housing more affordable for people across Ireland, and as such I reiterate our proposed revisions to the motion before us.