Dáil Éireann Debate, Wednesday - 21 April 2021
463. Deputy Marc MacSharry asked the Minister for Finance if he will give consideration to the extension of the help-to-buy incentive scheme for first-time buyers to include the purchase of existing dwellings given the shortage of new housing developments and the difficulty in getting planning permission for new builds in rural areas; and if he will make a statement on the matter. [18222/21]
View answer477. Deputy Seán Canney asked the Minister for Finance if he will extend the help to buy scheme to include the refurbishment of old property to upgrade; if not, if the scheme will be reinstated for habitation for first time homeowners; and if he will make a statement on the matter. [18451/21]
View answerI propose to take Questions Nos. 463 and 477 together.
The Help to Buy (HTB) incentive, is a scheme to assist first-time purchasers with the deposit they need to buy or build a new house or apartment. It also has as a key aim the encouragement of additional supply of new houses by supporting demand. The incentive gives a refund of Income Tax and Deposit Interest Retention Tax (DIRT) paid in Ireland over the previous four years, subject to limits outlined in the legislation.
In addition to the conditions laid down in section 477C Taxes Consolidation Act 1997 (TCA), including that the property is occupied as the sole or main residence of a first time purchaser, section 477C(2) defines a ‘qualifying residence’. The legislation is very specific as to the definition of a qualifying residence. It must be a new building which was not, at any time, used or suitable for use as a dwelling. If the property was non-residential, but has been converted for residential use, it may qualify for HTB. Renovation or refurbishment of old houses to either upgrade or reinstate them for habitation does not qualify for HTB.
In relation to second-hand properties generally, an increase in the supply of new housing remains a priority aim of Government policy. As mentioned above, the HTB scheme is specifically designed to encourage an increase in demand for affordable new build homes in order to encourage the construction of an additional supply of such properties. A move to include second-hand properties within the scope of the relief would not improve the effectiveness of the relief; on the contrary it could serve to dilute the incentive effect of the measure in terms of encouraging additional supply. I have no plans to extend HTB to second-hand properties.
