I propose to take Questions Nos. 256 and 257 together.
The income eligibility bands for access to social housing support, and the authority area assigned to each band were based on an assessment of the income needed to provide for a household's basic needs, plus a comparative analysis of the local rental cost of housing accommodation across the country. It is important to note that the limits introduced at that time also reflected a blanket increase of €5,000 introduced prior to the new system coming into operation, in order to broaden the base from which social housing tenants are drawn, both promoting sustainable communities and also providing a degree of future-proofing.
The accepted benchmark of housing affordability is that households, particularly low- to moderate-income households, should not be paying more than one third or 35% of their disposable income on accommodation costs and the income thresholds for access to social housing support generally achieve this. Recognising that there are people who do not qualify for social housing but find it very challenging to purchase or rent at market rates, the Government has brought in new measures specifically targeted at delivering affordable homes.
Affordable housing is generally targeted at households earning a maximum gross income of €50,000 (single applicant) or €75,000 (joint applicant). Affordable homes to buy will be delivered under a new statutory Scheme; the relevant provisions of Part 5 of the Housing (Miscellaneous Provisions) Act 2009 have been commenced and regulations & guidance are being finalised.
This new Scheme replaces all previous affordable purchase schemes; is led by housing authorities; is a shared equity scheme with a fully repayable equity share/discount; eligibility and priority are set out in the legislation and will be expanded upon in the regulations; and the equity repayments will be pooled into a strategic affordable housing fund managed by the HFA.
The Scheme is complementary to other Government schemes which help first-time buyers to buy a home, such as the Help to Buy Scheme and the new Rebuilding Ireland Home Loan. The Rebuilding Ireland Home Loan was introduced from 1 February 2018, following a review of the two existing local authority home loan schemes, the House Purchase Loan and the Home Choice Loan. The new loan enables credit worthy first time buyers to access sustainable mortgage lending to purchase new or second-hand properties in a suitable price range. The low rate of fixed interest associated with the Rebuilding Ireland Home Loan provides first time buyers with access to mortgage finance that they may not otherwise be able to afford at a higher interest rate.
Single applicants for the loan may earn up to €50,000 gross per annum, while the combined income of joint applicants may be up to €75,000 per annum. These income limits are unchanged from the previous local authority loan offerings. The maximum dual-income threshold also applies to the new Affordable Purchase Scheme which will enable a maximum purchase price of c. €320,000, which is in line with the purchase limits set out under the Rebuilding Ireland Home Loan.
It is important to note that there are no set minimum income limits for the scheme; however, applicants must be capable of repaying the mortgage in accordance with the statutory credit policy underpinning the loan.
Full details of the loan’s eligibility criteria and other information are available from the dedicated Rebuilding Ireland Home Loan website:
http://rebuildingirelandhomeloan.ie/. Subject to certain conditions, any person who meets the eligibility criteria may apply for a loan regardless of whether or not they are on the local authority housing list or qualified for social housing support.
There is also a gap between social housing and the rental market that needs to be filled, in order to support housing affordability, national competitiveness and the attractiveness of our main urban centres as places to live as well as work. Cost rental is an important component of progressive housing systems around Europe and after detailed financial modelling by my Department, the National Development Finance Agency and the European Investment Bank/Housing Finance Agency, Dublin City Council is working on the first major cost rental project to deliver over 300 cost rental homes at Emmet Road, Inchicore, as part of a mixed-tenure development of some 470 homes in total.
In parallel, the Housing Agency, Dún Laoghaire-Rathdown County Council and a number of Approved Housing Bodies (AHBs) have been working on a smaller-scale cost rental pilot, at Enniskerry Road, the tenders for which have been issued. Learning from these pilot projects, cost rental will now be rolled out across other suitable sites.
As part of the broader social housing reform agenda, a review of income eligibility for social housing supports is underway. The Housing Agency is carrying out the detailed statistical work which will underpin this review on behalf of my Department. The review will obviously have regard to current initiatives being brought forward in terms of affordability and cost rental and will be completed when the impacts of these parallel initiatives have been considered.
