The Rebuilding Ireland Home Loan was launched on 1 February 2018 to replace the existing House Purchase and Home Choice Loan schemes, providing a new line of mortgage finance, including fixed rates over 25 to 30 years, to creditworthy first-time buyers who cannot access sufficient mortgage finance from commercial lenders.
The HFA borrowed €200 million to fund the scheme, and it was estimated that the drawdown would be approximately €200 million over three years. Some criticism at the time was that insufficient loans were being approved and drawn down. However, as Minister I had made a commitment to seek further funding at an early stage, if necessary, given my belief in the scheme's potential.
The scheme has been more successful than anticipated, and by the end of January, €106m had been drawn down, accounting for 53% of the available funding, at a point at which €66m would have been more consistent with the expectation of a three year draw down period. By the end of March, draw downs have reached €127m.
As a result, to date, a number of local authorities have issued loans to a level, which has used up their approved allocations for the scheme. These are Cork County Council, Fingal County Council, Meath County Council, Wicklow County Council and Waterford City & County Council.
My officials kept me informed regarding progress on the loan on a regular basis, and have been engaging with the Department of Public Expenditure and Reform since October 2018 when higher lending and drawdown volumes were beginning to materialise.
I informed the Dáil on 29 January 2019 of the scheme’s success and of the need for additional funding, and further indicated that my Department was in discussions with the Departments of Public Expenditure and Reform and Finance with regard to the allocation for 2019. Local authorities could continue to accept applications as the total funding had not been drawn down. A meeting with the Minister for Finance and Public Expenditure and Reform took place on 5 March 2019.
Ongoing discussions between the three Departments have included consultation with the Central Bank as recently as last Friday, 5 April. When these discussions have concluded, I will be in a position to confirm the level of allocation for 2019. In the meantime, the scheme remains open and all local authorities have been advised to continue to receive and process applications.