Part 5 of the Housing (Miscellaneous Provisions) Act 2009 was commenced in 2018, and provides the statutory basis for the provision of affordable housing for purchase.
In March 2019, I signed the Housing (Miscellaneous Provisions) Act 2009 (Part 5) Regulations 2019, which primarily deal with the order of priority for the allocation of affordable homes within a Scheme of Priority. These regulations do not contain a reference to a 35% of net income threshold.
Section 84 (2) of the 2009 Act provides that where a household applies to a housing authority to purchase an affordable dwelling under an affordable dwelling purchase arrangement, the housing authority shall carry out an assessment of the household's eligibility. This assessment will take into account a range of factors, including the provisions of section 84 (2)(b), which provides that the assessment will have regard as to whether the income of the household is adequate to meet the repayments on a mortgage, i.e. that payments should not exceed 35% of the household's annual income, net of income tax and PSRI.
In relation to the Rebuilding Ireland Home Loan, this is another measure which seeks to address issues of affordability. Rather than a Loan to Income (LTI) limit of the nature suggested, a maximum permissible Net Disposable Income (NDI) ratio of 35% is used in respect of the loan. This reflects more accurately the benefit to the individual of the low fixed rate available for the full life of the loan.