Dáil Éireann Debate, Tuesday - 13 February 2024
224. Deputy Catherine Murphy asked the Minister for Finance if he plans to review the help-to-buy scheme from a socioeconomic impact perspective; and his plans to review the scheme in the context of economic impact. [6128/24]
View answer225. Deputy Catherine Murphy asked the Minister for Finance the total expenditure on a review of the help-to-buy scheme that was delivered in 2022; if he will provide a schedule of actions and progress of same in relation to the conclusions that were drawn from the review; and if he accepts them in part, in full or if he rejects them. [6129/24]
View answerI propose to take Questions Nos. 224 and 225 together.
The Help to Buy Scheme was introduced in 2017 with the purpose of assisting first-time buyers with the deposit required to purchase or self-build a new house or apartment to live in as their home. The relief is only available in respect of new builds, with a view to increasing the supply of new housing and stimulating demand.
To date, the Help to Buy scheme has been a significant support for first time buyers of new homes. To 1 February 2024, some 44,556 first-time buyers, either singly or as part of a couple, have benefited from the scheme.
The most recent independent review of the Help to Buy scheme was conducted by external consultants, Mazars, and took place in 2022. The cost of this review was €64,300 (excluding VAT). The report can be found at the following link: www.assets.gov.ie/235748/3b8ca22f-969c-40ab-a278-08583d533b48.pdf.
As part of this review Mazars made a number of recommendations, one of which was that the scheme should be extended for a further two years. This recommendation was adopted in Finance Act 2022 and I took the decision in Budget 2024 to extend the scheme for one further year to provide market certainty while awaiting the increase in new housing supply envisaged by the Government’s Housing for All strategy. The Help to Buy scheme forms part of this multi-faceted approach to increase the supply of new housing.
I also made amendments to ensure that a greater number of affordable homes purchasers under the Government’s Local Authority Affordable Purchase schemes can benefit from Help to Buy. This was an issue highlighted in the Mazars report, and the amendment will mean that more affordable home purchasers will be eligible for the Help to Buy scheme, subject to all other conditions of the scheme being met.
As I have outlined, the Mazars review took place in 2022 and even since then, there have been some very significant changes in the market. For example, the rapid increase in interest rates in the intervening period means that further stability and certainty is needed for first time buyers who now face much higher mortgage interest rates. For this reason I decided that now is not the time for the withdrawal of supports for those purchasers.
It remains the case that, as with any tax expenditure, the scheme will be kept under review.
As I have stated many times, housing is a top priority and I confirm that the Help to Buy scheme will continue to be examined and if required, additional changes will be considered this year.
