Help-To-Buy Scheme

Dáil Éireann Debate, Wednesday - 5 July 2017

Wednesday, 5 July 2017

Questions (38, 39, 63, 67)

Pearse Doherty

Question:

38. Deputy Pearse Doherty asked the Minister for Finance if he will suspend the help-to-buy scheme immediately for new applications; and the status of the review of the scheme. [31451/17]

Niamh Smyth

Question:

39. Deputy Niamh Smyth asked the Minister for Finance the position regarding the review of the help-to-buy scheme; and if he will make a statement on the matter. [31248/17]

John Curran

Question:

63. Deputy John Curran asked the Minister for Finance if he is reviewing the help-to-buy scheme; his views on whether this scheme is adding to increases in new house prices; his further views on the future for this scheme; and if he will make a statement on the matter. [31347/17]

Clare Daly

Question:

67. Deputy Clare Daly asked the Minister for Finance further to Parliamentary Question No. 201 of 4 April 2017, if the independent economic impact assessment of the help to buy incentive referred to in the response to that question has been commissioned; and the status of its progress and findings to date. [31426/17]

Written answers

Minister for Finance

I propose to take Questions Nos. 38, 39, 63 and 67 together.

As the Deputies may be aware, during the Committee Stage debate on Finance Bill 2016, my predecessor agreed to commission an independent impact assessment on the effects of the Help to Buy incentive for completion prior to Budget 2018. Following a competitive tender process, Indecon Economic Consultants were appointed in April to undertake this assessment.

This purpose of the project, in general, is to assess whether the policy objectives on the supply of new homes are being met, what impact (if any) the scheme is having on new and second-hand house prices, and what impact the scheme is having on the residential property market generally.

Any moves to amend or suspend the incentive prior to the completion of this report, which is scheduled for the end of August, would effectively pre-judge the outcome of the analysis. Once received from Indecon, the contents and findings of the report will be considered and I will decide on any appropriate action(s) to take in relation to its findings, in the context of my deliberations as part of the annual budgetary process.

The Government remains of the view that the Help to Buy incentive has the potential to increase the supply of new-build homes, which is a crucial factor in addressing the problems facing our housing market generally.

In my view, it is the lack of supply that is primarily responsible for driving house prices higher and I would point out that increases in house prices prevailed long before the introduction of the Help to Buy incentive. I would also point out that the scheme is targeted towards new build homes only, and to first-time buyers only, and it would be simplistic to designate this incentive as being the sole or the major contributor to house price increases.

Finally, I would like to reassure members of the public who may be in the process of applying for the Help to Buy incentive, or those who currently have applications pending, that speculation concerning its abolition will not impact negatively on their applications. I would propose to signal well in advance, any proposed changes to the incentive following my consideration of the Indecon report.