Dáil Éireann Debate, Tuesday - 25 January 2022
321. Deputy Bernard J. Durkan asked the Minister for Housing, Local Government and Heritage if he contemplates easing the housing loan deposit required by local authority housing loan applicants who are currently in private rental accommodation; and if he will make a statement on the matter. [3548/22]
View answerThe Local Authority Home Loan is a Government backed mortgage for those on modest or low incomes who cannot get sufficient funding from commercial banks to purchase or build a home. It has been available nationwide from local authorities since 4 January 2022 for first-time buyers and fresh start applicants. The loan can be used for new and second-hand properties, or to self-build.
To support prudential lending, applicants must have a deposit equivalent to at least 10% of the market value of the property. Of this deposit, cash savings should provide no less than 3% of the market value of the property and applicants must provide bank or similar statements for a 12-month period immediately prior to making an application clearly showing a credible and consistent track record of savings. Gifts can comprise the remaining 7% of the market value of the property where their source is verified. The 10% deposit applies irrespective of previous housing tenure, and I have no plans to change this requirement.
The availability of the Help to Buy scheme for first-time buyers offers additional assistance to purchasers using the Local Authority Home Loan to buy newly built properties. This should alleviate some of the challenges faced by first-time buyers in accessing the 10% deposit of the market value of the property. The initiative has been designed to provide immediate and targeted support for first-time buyers in meeting their deposit requirements and encouraging the construction of new housing units.
