Dáil Éireann Debate, Tuesday - 26 April 2022
668. Deputy Patrick Costello asked the Minister for Housing, Local Government and Heritage the method of calculation of the rental charge on 50 two-bedroom cost rental apartments delivered under the Housing for Aall scheme at the recently tenanted development (details supplied) in County Dublin. [20598/22]
View answerThe project referred to in the Question was developed by the Respond and Tuath Approved Housing Bodies (AHBs) on land provided by Dún Laoghaire-Rathdown County Council (DLRCC), with €4.5 million of funding provided through the Serviced Sites Fund, the precursor to the Affordable Housing Fund. This project is the result of an innovative collaboration between the two AHBs and DLRCC and includes 105 social housing homes at the same location.
The 50 purpose-built Cost Rental apartments have been allocated and the selected tenants began moving into their new homes from the 14th of March 2022. The cost-covering rent for these two-bedroom apartments is €1,200 per month, which represents a significant discount of approximately 40% on market prices in the area (c. €2,000).
The Affordable Housing Act 2021 (Cost Rental Designation) Regulations 2021, which came into effect on 19 August 2021, govern the process by which the owners of properties may obtain the designation of these as Cost Rental dwellings. This applies to any private or public body, including a Local Authority, AHBs, or the Land Development Agency. This designation is operated on an opt-in basis, but obtaining a designation is treated as a pre-requisite condition for Cost Rental properties that utilise funding from Departmental schemes, such as the Affordable Housing Fund and the Cost Rental Equity Loan.
As per the regulations, the applicant must propose an “initial maximum rent” for the dwelling. This is a year-one starting rent for that specific property, based on a financial cash-flow, which must be modelled over a stated period of at least 40 years (the “cost calculation period”). The applicant must also propose a minimum length of time over which the designation will apply (the “minimum cost rental period”), which must be at least as long as the cost calculation period.
Having regard to these regulations, my Department reviewed the two applications from each AHB for the Cost Rental Designation of their portion (25 homes each) at the development, based on this initial maximum rent of €1,200 per two-bedroom home. The Housing Agency completed a financial assessment for these applications on behalf of my Department, using the information provided by the Respond and Tuath AHBs and found both applications to be in accordance with said regulations, including that the rents proposed were accurate reflections of the costs incurred. Subsequent to this, I formally designated these homes as Cost Rental on 11th March 2022, for a period of 70 years, in line with the legislation and regulations.
