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Housing Policy

Dáil Éireann Debate, Thursday - 3 March 2022

Thursday, 3 March 2022

Questions (167, 204)

Kieran O'Donnell

Question:

167. Deputy Kieran O'Donnell asked the Minister for Housing, Local Government and Heritage the details of the affordable housing schemes under the Housing for All plan; the timeline for the introduction of the schemes; and if he will make a statement on the matter. [12101/22]

View answer

Bernard Durkan

Question:

204. Deputy Bernard J. Durkan asked the Minister for Housing, Local Government and Heritage the action that can be taken to enable housing to become affordable given that persons can no longer live in Ireland due to the high cost of mortgages and rents; and if he will make a statement on the matter. [11490/22]

View answer

Written answers

I propose to take Questions Nos. 167 and 204 together.

The Affordable Housing Act 2021, the first ever standalone affordable housing legislation, established a basis for four new affordable housing measures. These measures will deliver on the Programme for Government commitment to put affordability at the heart of the housing system and prioritise the increased supply of affordable homes through (1) delivering affordable homes on local authority lands, (2) the introduction of a new form of tenure in Cost Rental, (3) a First Home shared equity scheme and (4) expanding Part V planning requirements to increase the 10% contribution requirement to 20% and to apply it to cost rental as well as social and affordable housing.

This Act, supported by the unprecedented levels of funding committed to in the Housing for All strategy, averaging over €4 billion annually, will underpin the delivery of affordable housing targets. Specifically, 54,000 affordable homes will be delivered between now and 2030 by local authorities, Approved Housing Bodies, the Land Development Agency and through a strategic partnership between the State and retail banks.

At a national level, 2,550 Affordable Purchase homes and 1,580 Cost Rental homes are targeted for delivery for 2022. Annual targets will increase incrementally in subsequent years. 

The Local Authority Affordable Purchase Scheme will support eligible purchasers of Local Authority-delivered new homes by bridging the gap between the market value of the home and the combined value of the buyer's mortgage and deposit. Regulations setting out the detailed eligibility criteria for the scheme are at an advanced stage and will be issued in the coming weeks.

Separately, as part of the Housing for All strategy, additional funding of €1bn was committed to the Land Development Agency in order for it to deliver on its pipeline of housing. This includes Project Tosaigh under which the LDA will enter into forward purchase arrangements to kick-start stalled private developments and increase the supply of affordable housing. The LDA initiated a call on 12 November 2021 targeting a scale in excess of 150 affordable units per development and is currently assessing the proposals received.

Over 1,500 Cost Rental homes are expected to be developed and tenanted through three delivery strands in 2022: Approved Housing Bodies (AHBs), supported by Cost Rental Equity Loan (CREL) funding; Local Authorities through the Affordable Housing Fund (AHF), and the Land Development Agency (LDA), either on their portfolio of sites, or through Project Tosaigh. All Cost Rental homes will deliver rent prices at least 25% below market rates. 

The First Home shared equity scheme, under Part 4 of the Affordable Housing Act, will primarily support first-time buyers purchasing newly constructed homes on the private market. This scheme will be available at a national level and will incorporate regional price caps reflecting median house price sales. Confirmation of the final details of this scheme is ongoing in conjunction with the relevant stakeholders and it is anticipated that the First Home scheme will be available for applications in the second half of this year. This initiative is being designed to ensure support is provided to those that, because of the current income levels, cannot secure a sufficient mortgage to meet the cost of a modest newly constructed home in their preferred location.

Additionally the Help-to-Buy incentive supports first-time buyers in meeting the deposit requirements for newly-built houses or apartments, as well as self-build homes. Subject to the level of income tax and DIRT paid over the previous 4 years, the Help-to-Buy scheme provides a maximum benefit to first-time buyers of €30,000 or 10% of the cost of the newly constructed home. The Help-to-Buy scheme has already helped over 30,000 first-time buyers achieve the deposit required for a new home.  

Finally, the Local Authority Home Loan scheme commenced on 4 January 2022 and incorporates a lower interest rate, higher income eligibility thresholds for single applicants in Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow (increasing from €50,000 to €65,000), and more flexibility on house size. The loan can be used for new and second-hand properties, or for self-builds with a maximum value of 90% of market value of a residential property. The maximum market values are €320,000 in the counties Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow, and €250,000 in the rest of the country. 

The Help-to-Buy scheme, the Local Authority Affordable Purchase Scheme and the First Home scheme are designed to assist first-time buyers in meeting the higher costs of newly constructed homes and, in doing so, will increase the volume of new homes being developed. Importantly the CSO reported that housing completions amounted to 20,433 in 2021, a welcome increase over the 2015 reported levels of 7,219. The CSO also report that Commencement Notices for 30,724 new homes were issued in 2021, representing a 42% increase compared with 2020, or roughly the same as the combined reported totals from 2016 & 2017.

While these reported figures represent a significant step forward in the Government’s ambition to support the supply of new housing, it remains short of the 33,000 new dwellings annual target under Housing for All. This is why the Government has committed unprecedented levels of funding, averaging €4 billion per year to improve affordability for all families or individuals across society wishing to secure a home. 

Question No. 168 answered orally.
Question No. 169 answered with Question No. 140.
Question No. 170 answered with Question No. 140.
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