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Tenant Purchase Scheme Review

Dáil Éireann Debate, Thursday - 5 July 2018

Thursday, 5 July 2018

Questions (352)

Mattie McGrath

Question:

352. Deputy Mattie McGrath asked the Minister for Housing, Planning and Local Government the status of the review of the local authority tenant purchase scheme; when it will be completed; his views on whether changes in the way in which the scheme is administered will ensure those that have the ability to pay, regardless of income, can purchase their home; and if he will make a statement on the matter. [29726/18]

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Written answers (Question to Housing)

The Tenant (Incremental) Purchase Scheme which came into operation on 1 January 2016 is open to eligible tenants, including joint tenants, of local authority houses that are available for sale under the Scheme. To be eligible, tenants must meet certain criteria, including having a minimum reckonable income of €15,000 per annum and having been in receipt of social housing support for at least one year.

The minimum reckonable income for eligibility under the scheme is determined by the relevant local authority in accordance with the detailed provisions of the Ministerial Direction issued under Sections 24(3) and (4) of the 2014 Act. In the determination of the minimum reckonable income, local authorities include income from a number of different sources and classes, such as from employment, private pensions, maintenance payments and certain social welfare payments, including pensions, where the social welfare payment is secondary to employment income.

In determining reckonable income, the income of all tenants of the house, including adult children that are joint tenants, is included, as is the income of the spouse, civil partner or other partner/co-habitant of a tenant who lives in the house with them, thus ensuring the appropriate level of discount is applied to the purchase price.

The minimum income criterion was introduced in order to ensure the sustainability of the scheme. Applicants must demonstrate that they have an income that is long-term and sustainable in nature. This ensures that the tenant purchasing the house is in a financial position, as the owner, to maintain and insure the property for the duration of the charged period, in compliance with the conditions of the order transferring the ownership of, and responsibility for, the house from the local authority to the tenant.

The financing of any house sold under the Tenant (Incremental) Purchase Scheme is a separate matter from the eligibility criteria for the scheme. If the tenant is deemed eligible under the scheme, he or she may fund the purchase of a house from one, or a combination, of his/her own resources or a mortgage provided by a financial institution or a local authority house purchase loan.

In line with the commitment given in Rebuilding Ireland, a review of the first 12 months of the Scheme’s operation has been undertaken. The review has incorporated analysis of comprehensive data received from local authorities regarding the operation of the scheme during 2016 and a wide-ranging public consultation process which took place in 2017 and saw submissions received from individuals, elected representatives and organisations.

The review is now complete and a full report has been prepared setting out findings and recommendations. In finalising the report some further consultation was necessary and due consideration had to be given to possible implementation arrangements. These matters are now almost completed and I expect to be in a position to publish the outcome of the review shortly.

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