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Housing Policy

Dáil Éireann Debate, Thursday - 23 July 2020

Thursday, 23 July 2020

Questions (11, 15, 24)

Richard Bruton

Question:

11. Deputy Richard Bruton asked the Minister for Housing, Planning and Local Government the status of finalising the criteria under which affordable purchase and cost-rental will be made available to applicants; and the national elements such as income limits and guidance on local elements in cases in which local authorities have discretion. [16636/20]

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Richard Bruton

Question:

15. Deputy Richard Bruton asked the Minister for Housing, Planning and Local Government the initiatives to accelerate affordable housing schemes such as in a case (details supplied) in circumstances where the development of such homes has been the subject of numerous proposals and is long anticipated. [16637/20]

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Pádraig O'Sullivan

Question:

24. Deputy Pádraig O'Sullivan asked the Minister for Housing, Planning and Local Government his plans to increase the supply of affordable housing in County Cork. [17636/20]

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Oral answers (7 contributions)

We all know how badly needed social and affordable housing is. No one should be living in homeless hubs or caught in a never-ending rental trap. However, it is extremely difficult for people who are paying high rents to also save for mortgage deposits. Covid-19 will exacerbate this problem for many people, couples and families. When will the criteria for affordable purchase and cost-rental housing be published?

I propose to take Questions Nos. 11, 15 and 24 together.

I am absolutely committed to ensuring that affordable, quality homes are available to everyone in Irish society. This key Government goal is clearly reflected in the Programme for Government: Our Shared Future.

In particular, I am focusing on progressing the affordable purchase scheme and delivery programme and moving the cost-rental scheme forward. This work will focus on our major urban areas, where people and families are facing the greatest challenge in the context of housing access and affordability.

After taking some time to review progress and consult delivery partners, I will outline my detailed plans for affordable housing in the autumn. In doing so, I will also take account of the progress made under the serviced sites fund, SSF, and other existing measures, such as the Rebuilding Ireland home loan scheme and the help-to-buy scheme.

Together with State-led affordable housing for purchase and cost-rental, I also plan to expand Part V of the Planning and Development Act 2000 to deliver much needed affordable as well as social housing and protecting the 10% social provision.

I am bringing all delivery partners together to work on the expansion and acceleration of our affordable housing programmes. Local authorities, the Housing Agency, the Land Development Agency and approved housing bodies all have a part to play. They have all been most helpful to me in recent weeks since I took over as Minister.

I intend to expand the €310 million SSF, which targets local authority areas where affordability has been identified as an issue and which provides funding for facilitating infrastructure on local authority land thereby subventing the end cost of the affordable homes.

With a maximum funding ceiling of €50,000 available per home, the SSF can facilitate at least 6,200 affordable homes. To date, funding of €127 million has been allocated in support of 35 projects in 14 local authority areas, which will assist in the delivery of almost 3,200 affordable homes. Details of all projects that have received funding approval, including those in Dublin and Cork, are available on the Department's website.

In terms of affordable purchase, Part 5 of the Housing (Miscellaneous Provisions) Act 2009, commenced in June 2018, provides the statutory basis. Under regulations issued in March 2019, a scheme of priority is decided by each local authority detailing the arrangements for the access to affordable purchase homes. In the first instance, it is the responsibility of local authorities to identify affordability issues and bring forward sites where the provision of more affordable housing is viable. The scheme of priorities has been problematic and must be greatly improved on and that will be part of the more streamlined affordable housing approach for local authorities.

The main eligibility criterion under the Act is that the applicant must be a first-time buyer, with limited exceptions. The applicant's net household income must be such that the repayments on a 90% mortgage for the purchase of a suitable home at market value would not exceed 35% of his or her net income.

As part of my work leading up to the autumn announcement, I will be scrutinising the statutory basis of the scheme with delivery partners, particularly as it relates to viability and eligibility criteria, in order to ensure that it reflects this Government's policy priorities and delivers the outcomes we need.

The first homes that will be made available under the new affordable purchase scheme will be on Boherboy Road in Cork city in early 2021. I commend Cork City Council on its progressive work in respect of this project and utilising moneys from the SSF. Other local authorities are following suit and I will ensure that we see more and more projects like this delivered on key local authority sites.

To support rental affordability, the Government is also committed to the introduction of cost-rental housing in Ireland, where the rents charged cover the cost of delivering, managing, and maintaining the homes only. A working group has been examining the most appropriate model for delivering cost-rental, including the use of public land, appropriate Exchequer inputs and operational matters such as tenant eligibility.

The work is also being supported by research by the European Investment Bank. I expect initial findings of this group to be completed within the coming months and I have asked that this work be expedited. This will allow us to expand on the three pilot developments currently under way. I will also provide an update on cost rental in the autumn. We need options on a national cost rental plan and policy. I know I will have the Deputy’s assistance in putting that together and I hope that has answered her specific question on affordability.

I thank the Minister for his reply. Unfortunately many people of my age and indeed many of my friends cannot afford to buy their own homes despite having good jobs. If the average worker cannot afford to buy a home then we are failing them. Today a person on the average industrial wage for a full-time worker can borrow just €175,000. That is not much use to a person who may want to live in Lucan, Clondalkin or elsewhere in my constituency. Will the Minister confirm that people on the average wage will be able to buy affordable homes under his plan?

I intend that will absolutely be the case. Under the Government plan, we will not exclude couples who earn more than €75,000, unlike what other parties have put forward, which would exclude nearly half of those who need housing. We need to look at the net cost for people. The Deputy is 100% correct in that there are so many people out there who are working hard, paying 50% to 60% of their net take-home pay on rent. They are trying to save every cent, and are never going to reach the target they need to reach, first in savings, but second in income. I do not want them to be chasing an unaffordable mortgage. That is not what this Government or the Deputy wants.

In the interim we will keep other measures in place. We will keep the help to buy grant in place which helps some first-time buyers and we will potentially expand it. The Rebuilding Ireland home loan has been a really good support for people as well and it will be expanded. There are moneys there for this year and I would ask people to look at it. It is a very good fixed-term mortgage contract for 20 to 25 years. To answer the Deputy’s question, we will be ensuring that those working on average, normal incomes will be able to access our Government’s affordable housing scheme.

I thank the Minister. This is a significant issue for me and is one of the reasons I am here today. It is a massive issue for my generation. I want to work hand-in-hand with the Minister to deliver affordable homes for people across Lucan, Clondalkin and right across this country.

We will bring forward a plan in the autumn and we will be looking for input from Members of all parties and none. We do not want to delay this. People have waited too long for an affordable purchase scheme. We can deliver homes quite quickly under some of the options that I am also looking at. Fundamentally, there is a whole generation of people to whom the Deputy referred, including her friends in the constituency, who feel right now they have no hope of ever owning their own home. We are going to change that and I, as housing Minister, am absolutely convinced that we will. This is a priority for me on which we are working every day. This autumn I intend to launch the plan and bring it forward. Let us get moving on it to deliver affordable homes for our people.

I take it that the Deputy is satisfied with the Minister's answer.

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