Eoin Ó Broin
Question:373. Deputy Eoin Ó Broin asked the Minister for Housing, Local Government and Heritage the average subsidy per unit envisaged through the first home scheme as included in Vote 34, subhead A31. [18149/22]
View answerTuesday, 5 April 2022
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With an overall budget of in excess of €4 billion per year, the Government's Housing for All strategy commits to supporting 54,000 new affordable homes by 2030, 36,000 of which will be for purchase and 18,000 for Cost Rental.
Part 4 of the Affordable Housing Act 2021 provides the basis for the First Home Scheme, which will be available nationwide. This scheme will support eligible first-time buyers to buy a new-build home in private developments by means of an equity share model, similar to that employed in the Local Authority Affordable Purchase Scheme. This equity support will cover up to 30% of the price of a new home (or 20% if the purchaser also benefits from the Help to Buy incentive), subject to regional price ceilings which will reflect the median prices paid by first-time buyers for new homes.
First Home will be jointly funded on a 50:50 basis by the State and participating mortgage lenders, thereby increasing the pool of funding available to potential new homeowners. Subject to final approvals, it will operate for the period 2022 to 2025, deploying an anticipated funding of c. €400 million and supporting an estimated 8,000 home purchases. Budget 2022 allocated €44 million to my Department for First Home this year.
A new First Home Scheme Ireland DAC, incorporated in December, will operate this scheme. Significant work is continuing on the detailed design and parameters of the scheme, and full details will be confirmed upon completion of this work. Initial activity on key areas of work, including public communications, will be undertaken over the next months in advance of First Home’s first receipt of applications and deployment of equity support, scheduled for Q2 this year.
It should be noted that there is no 'subsidy' element in the support offered by the First Home Scheme. Through the First Home DAC, the State is making an investment in these purchases in order to enable people to achieve home ownership The DAC's equity interest in the homes will be redeemed in time and the State's share of the proceeds returned to the Exchequer. The benefit for purchasers is the opportunity to become a homeowner now at a reduced cost, with the ability to redeem the DAC's equity share at a future time of the homeowner's choosing, but with no obligation for redemption save for particular circumstances such as the sale of the home.