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Housing Provision

Dáil Éireann Debate, Thursday - 17 June 2021

Thursday, 17 June 2021

Questions (279)

Bernard Durkan

Question:

279. Deputy Bernard J. Durkan asked the Minister for Housing, Local Government and Heritage if he anticipates initiating any actions or reform with a view to ensuring that the housing market is tilted in favour of the provision of affordable housing accommodation to first time home seekers; and if he will make a statement on the matter. [32780/21]

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Written answers

The Programme for Government commits to putting affordability at the heart of the housing system. Delivery on this commitment is evidenced in the new measures contained in the Affordable Housing Bill 2021, currently before the Oireachtas, which provides for three schemes that will increase the supply of affordable homes through (1) affordable homes on local authority lands, (2) the introduction of a new form of tenure in Cost Rental, and (3) a new affordable purchase shared equity scheme.

Affordable homes on local authority lands are to be made available through the support of the €310 million Serviced Sites Fund (SSF). Information on the schemes that have received approval in principle under the Serviced Sites Fund are available at:

https://rebuildingireland.ie/news/minister-murphy-gives-the-go-ahead-for-ten-local-authority-sites-for-affordable-housing-under-the-serviced-sites-fund/, and

https://rebuildingireland.ie/news/minister-murphy-approves-funding-of-e84m-to-support-delivery-of-1770-affordable-homes-under-the-ssf/.

In addition to the 35 SSF projects referenced in the links above, approval in principle has also been given to five additional projects - Emmet Road and Oscar Traynor Road (Dublin City Council), Shanganagh (Dún Laoghaire Rathdown County Council), Hayestown and Ballymastone (Fingal County Council).

Cumulatively, these 40 SSF projects, across 14 local authorities, will assist in the delivery of just over 4,400 affordable home to buy or rent. My Department continues to engage with local authorities to progress both current and potential projects, with the first SSF project to deliver affordable homes for purchase under the SSF later this year being the Boherboy project in Cork City.

In making an application for SSF funding, each local authority must demonstrate that an affordability issue exists in the area in question and that it is viable to deliver homes, for purchase or rent, with a price reduction of at least 10% below open market values, with the reduction remaining as fully-repayable equity charge against the property. The scheme is targeted at first-time buyers, with some limited exceptions as outlined in the Affordable Housing 2021 Bill.

In addition to the affordable homes to be delivered through the SSF, Budget 2021 allocated €75 million for the Affordable Purchase Shared Equity Scheme, which is aimed at first-time buyers buying a new-build home on private land. It will help these first-time buyers secure their own home by bridging the gap between the mortgage available to them and the price of the home they want. Work on the detailed design of the proposed scheme is ongoing and at an advanced stage.

The Affordable Housing Bill will also place a new form of tenure in Cost Rental on a statutory basis for the first time. Cost Rental directly links rents to the cost of provision rather than market dynamics. Three initial Cost Rental projects are already underway. The first Cost Rental homes in Ireland, 50 two-bedroom apartments at Enniskerry Road, Stepaside, will be delivered by the Tuath and Respond Approved Housing Bodies in Quarter 3 2021. Dublin City Council is also progressing a site at Emmet Road, Inchicore (the former St Michael’s Estate), and the LDA is collaborating with Dún Laoghaire-Rathdown County Council on a site at Shanganagh, Shankill.

The provision of Cost Rental housing is also being implemented through the new Cost Rental Equity Loan (CREL) scheme, which was allocated €35m in Budget 2021. I approved in principle the financing this year of 390 new homes across eight sites, located in Dublin, the Greater Dublin Area, and Cork. CREL support and careful cost management has generated initial rents which are at least 25% below comparable open market prices, delivering significantly improved affordability for renters.

In addition to the aforementioned measures in the Affordable Housing Bill 2021, the Land Development Agency (LDA) is tasked to work with Government Departments, local authorities, state agencies and other stakeholders to assemble strategic sites in urban areas and ensure the sustainable development of social and affordable homes for rent and purchase. On establishment, the LDA had access to an initial tranche of 8 sites that have near term delivery potential for approximately 3,400 new homes. In partnership with Dun Laoghaire Rathdown County Council, the LDA has been granted planning permission for the development of 597 homes on a site in Shanganagh. Approximately 34% of the units will be for social housing, 51% will be cost rental and 15% will be for affordable purchase. Work has commenced on the construction tender process, with construction anticipated to start in the second half of 2021. Information on the work of the LDA is available at: https://lda.ie/.

On the 4th May last, the Government also approved the drafting of amending provisions to Part V of the Planning and Development Act 2000, for inclusion in the Affordable Housing Bill 2021 as Committee Stage amendments. This will see an increase in the current 10% social housing requirement related to all new housing developments to a mandatory 20% for social and affordable requirements.

Other affordability measures, such as the Help to Buy Scheme, and the Rebuilding Ireland Home Loan, are already available to eligible purchasers nationally to make home ownership more affordable.

The Help to Buy Scheme may return tax paid in the previous four years to eligible first-time buyers, up to a maximum amount of €30,000, for a new home. Information is available at: https://www.revenue.ie/en/property/help-to-buy-incentive/index.aspx.

The Rebuilding Ireland Home Loan enables credit worthy first time buyers to access sustainable mortgage lending to purchase new or second-hand properties in a suitable price range. There are no set minimum income limits; however, applicants do need to have sufficient borrowing and repayment capacity and must be capable of repaying the mortgage. Further information on the Rebuilding Ireland Home Loan is available at http://rebuildingirelandhomeloan.ie/.

Finally, I can confirm the Government’s upcoming Housing strategy ‘Housing for All’ will detail an extensive range of measures and ambitious targets to underpin the delivery of affordable housing over the coming years.

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