Louise O'Reilly
Question:648. Deputy Louise O'Reilly asked the Minister for Housing, Local Government and Heritage when the revised cost rental equity loan (CREL) guidance document will be published. [48000/23]
View answerTuesday, 7 November 2023
Questions (648)
Written answers
Under Housing for All, 18,000 Cost Rental homes are targeted between now and 2030. While the initial pipeline of Cost Rental homes are targeted in the Greater Dublin Area, Cork City and other major urban centres, similar to Local Authority Affordable Purchase homes, Cost Rental delivery will also be scaled up and implemented across more Local Authorities as soon as practicable.
Since the passing of the Affordable Housing Act in July 2021, over 800 Cost Rental homes have been delivered, by Approved Housing Bodies (AHBs), Local Authorities and the Land Development Agency (LDA).
The Government increased income thresholds for Cost Rental homes, with net household income limits for eligibility of €66,000 in Dublin and €59,000 elsewhere. This was introduced across the Cost Rental sector from 1 August 2023, replacing the former national net income limit of €53,000. The increased thresholds recognise that prevailing rents in the private market have increased significantly in recent years and a large cohort of private renters are experiencing severe affordability challenges, particularly in Dublin. The new thresholds will apply to all Cost Rental homes provided under the Affordable Housing Act 2021.
The Government has also agreed significant changes to the Cost Rental Equity Loan (CREL) on foot of a recommendation from the Working Group on the Cost Rental Equity Loan. CREL is available to Approved Housing Bodies which provide Cost Rental homes. The improved loan will see availability of increased levels of loan finance, together with new State equity investment which will improve the ability of Approved Housing Bodies to bring forward Cost Rental homes. Overall State funding is increasing from 45% up to 55% of capital costs, on a sliding scale as necessary for project viability at appropriate rent levels. The existing loan model is being supplemented with new State equity investment element (up to a maximum of 20% of capital costs), which will effectively never need to be realised so long as the property remains in the Cost Rental sector.
My Department informed the Approved Housing Bodies (AHB's) and the Housing Agency of these changes to the CREL scheme and the Department is currently finalising a revised CREL guidance document, which will be issued to the AHB's and their representative groups in the coming weeks. While the issuing of revised guidance will be of use, it is no barrier to applications being submitted or assessed and indeed AHB's have been encouraged to, and continue to, submit CREL applications, which have been assessed and approved under the new parameters.