Dáil Éireann Debate, Thursday - 26 November 2020
241. Deputy Duncan Smith asked the Minister for Housing, Local Government and Heritage the status of the provision of an affordable housing scheme; when legislation for such a scheme will be brought to the Houses of the Oireachtas; and if he will make a statement on the matter. [39313/20]
View answerThe Programme for Government makes clear our commitments to provide measures for good-quality housing to purchase or rent at an affordable price and in Budget 2021, funding of €110 million was ring-fenced for two new schemes including a national Affordable Purchase Shared Equity Scheme and a Cost Rental Equity Loan facility to help deliver Cost Rental homes. Both of these programmes will begin in 2021.
€75 million will be allocated to the affordable purchase shared equity scheme. I intend to target the scheme at first time buyers, who are seeking to buy a new home but who cannot quite secure the full mortgage amount to do so at the present time. Subject to the final qualifying criteria, the scheme would see the State take a limited equity stake in a property, in order to help more people meet the cost of buying a new home with their available mortgage.
To this end, significant preparatory work has already been carried out by my Department working primarily with the Housing Agency and the Department of Finance. Intensive engagement continues with key stakeholders informing the final detailed parameters of the scheme, as well as with home builders to seek to increase the output of new homes in response to the new scheme.
In addition, €35m has been allocated to the new Cost Rental Equity Loan (CREL) facility to support Approved Housing Bodies (AHBs) to deliver approximately 350 Cost Rental homes at scale from next year. Added to the 50 Cost Rental homes that will be delivered in Enniskerry Road, Stepaside in Q3 2021, it will accelerate delivery in this new sector in advance of the Land Development Agency's planned future output and the work of local authorities. This scheme will leverage the proven expertise and capacity of the AHBs, demonstrated in their development and management of social housing units. The CREL scheme will allow cost-covering rents to be set at a lower level and so making them more affordable for tenants. Further details on the scheme will be announced in due course.
In addition to these new schemes, I will also progress and accelerate the local authority led scheme to deliver more affordable homes for purchase and rent on public land. The statutory basis for the delivery of affordable new housing for purchase on local authority lands is Part 5 of the Housing (Miscellaneous Provisions) Act 2009, which was commenced in June 2018.
The broad parameters of the local authority led Affordable Purchase Scheme will be as follows:
- aimed at first-time buyers who cannot purchase a home adequate to their needs on the open market under the macro prudential rules;
- homes purchased under the scheme will be subject to a maximum statutory discount of 40% (relative to the market price), with the final price of the affordable homes to be linked to the cost of provision, on a site by site basis, and
- the local authority maintains a fully repayable equity share in the properties equivalent to the percentage discount given.
Furthermore, €310m is available to local authorities for Serviced Sites infrastructure funding that will support the delivery of up to 6,200 new homes that will be made available under this scheme. The first SSF project that will be deliver affordable homes will be Boherboy Road in Cork City in early next year.
It is envisaged that the homes delivered under all of the above schemes will be made available to applicants who meet defined eligibility criteria. The precise eligibility conditions are currently being developed in light of the on-going policy analysis outlined. I intend to bring forward any necessary provisions to underpin these schemes in a forthcoming Affordable Housing Bill which will be brought to Government in the coming weeks.
The Land Development Agency (LDA) will play an increasingly significant role in the delivery of more affordable housing, as promised in the Programme for Government. The LDA is currently developing 9 sites that have near-term delivery potential for 3,600 new homes, the majority of which will be for Cost Rental and affordable purchase. It is also engaged in the progression of a number of other sites with potential for significant housing output. In the longer term, it will assemble strategic land-banks from a mix of public and private lands, making these available for housing in a controlled manner, which will bring essential long-term stability and sustainability to the Irish housing system.
