Dáil Éireann Debate, Thursday - 15 February 2024
67. Deputy Jim O'Callaghan asked the Minister for Housing, Local Government and Heritage his current assessment of all the key housing indicators, that is, commencements, completions and planning permissions; and if he will make a statement on the matter. [6807/24]
View answer123. Deputy Jim O'Callaghan asked the Minister for Housing, Local Government and Heritage how many new homes have been delivered since the launch of the Housing for All plan in September 2021; and if he will make a statement on the matter. [6808/24]
View answerIt is now two and half years since the Minister introduced the Housing for All plan. What is his assessment as to how the plan is working, by reference to the key indicators in respect of housing such as planning permissions, constructions and commencements?
Second, the reason the Minister and the Government introduced the Housing for All plan was that we recognised that we needed to really speed up the process of building houses. How are we doing in terms of the factual number of units that have been built since the his plan was introduced? I would be interested to hear that.
Gabhaim buíochas leis an Teachta O'Callaghan for his question.
Increased supply is key to meeting our housing needs and addressing the challenges in the housing market. That is why we brought forward, as a Government, Housing for All, which is the single biggest intervention in housing any Government has made in the history of the State, and rightly so. That needed to happen. Among the challenges are our priority of homelessness, ensuring that people can buy their own home at an affordable rate and reducing social housing waiting lists. Output for 2022, for which we have the full-year figure, and 2023, for which we do not yet have the full-year figure for social and affordable housing, clearly shows we are on the right track. All the housing indicators - commencements, completions and planning permissions - are trending upwards.
There has been a substantial uplift in the number of new homes delivered since the launch of Housing for All in 2021. The most recent completions data published by the Central Statistics Office show that some 29,726 and 32,695 new homes were completed in 2022 and 2023, respectively. That is just short of 30,000 in 2022, which was more than 5,000 ahead of our target, and 32,695 last year, so we exceeded our target in both years. New home delivery last year was at its highest level in 15 years, some 10% higher than in 2022 and 13% higher than the Housing for All target we set ourselves for 2023.
While housing supply continues to be impacted by external factors, including construction cost inflation, which we have to watch, high interest rates, and labour and capacity to deliver, the outlook for this year is good and that for next year is equally promising.
The number of dwellings granted planning permission in the first nine months of last year was up 13% on the same period in the previous year, 2022. Some 30,000 planning permissions were granted in that period, the second highest granted for the January-to-September period in over ten years, and surpassed only by the 32,835 granted for the same period in 2020. We therefore have a really good pipeline. I think people will see, not just in Dublin but also in our major cities and in towns and villages across the country, the developments that are happening.
Planning approvals in quarter 3 of 2023, the most recent data I have on planning permission, were up 43% year on year, from 6,700-odd units in quarter 3 of 2022 to 9,600 units in quarter 3 of 2023. The number of houses granted planning permission rose by more than 10% in quarter 3 of 2023 when compared with the same period in 2022.
While planning permissions are one element, commencements are also really important. They are the indicators for work actually starting on developments on the ground. The 12-month commencements for the period to the end of December numbered almost 33,000. That is an increase of 21% year on year, with a steady month-on-month increase in the rolling total since mid-2022. Commencements for last year reached the highest annual figure for any calendar year in the past decade.
Initial forecasts suggest that the target we have set ourselves this year, 33,450, will be met this year and will be exceeded again.
I am under no illusion as to the continued challenge we face. We have to continue to increase that supply across all tenures. What leads me to be optimistic about this is the first-time buyer segment. About 600 first-time buyers are drawing down their mortgages now, buying homes because they are using the first home scheme, the equity scheme which this Government brought forward. They continue to use at an increased rate the help-to-buy grant, worth up to €30,000 of their own money.
I have not even touched on vacancy because the vacancy figures are not included in the reply. I might come back to them in a supplementary reply.
I thank the Minister for his answer. Two things have been apparent. First, a new plan was needed. When we came into government, we recognised that something needed to change. That is why the Government deserves to be commended on spending time on putting together a new plan, namely, as the Minister said, Housing for All.
Second, it is difficult and it is a slow process to turn around but, based on the statistics the Minister has given the House, it appears to be the case that things are improving. It is a difficult task and what will ultimately be the proof of the pudding will be the number of units constructed. According to the figures he has given, it is clearly the case that commencements and construction are up significantly. Any fair observer who goes around this city or around the country can see on the ground that there is significant development happening. In my constituency, an area I have spoken to the Minister frequently about is the glass bottle site. That is being constructed, and we just need to see more construction take place around the country.
Another issue which was not taken into account when the plan came into place was the dramatic rise in Ireland's population. Many people talk to us about how in the 1960s and the 1950s we were able to produce housing for our population. That was correct, and Fianna Fáil deserves a lot of credit for that. Unfortunately, however, back in the 1950s and the 1960s, we had a declining population. One of the extraordinary things about Ireland is the way the population is increasing so rapidly at present. Part of the reason for that is our economic success; people want to come here. It does, however, put huge pressure on the Minister and on his plan in terms of meeting the increased demand. Does he think, in light of the population and its increase, that he needs to look again at the targets as to what we require, or is it something he thinks the Housing for All plan at present is capable of dealing with?
I commend the Minister also on the policies that have been put in place for the first home scheme and the help-to-buy scheme. They have helped very many new buyers.
I thank the Deputy. Undoubtedly, the first-time buyer supports are helping. I meet people across the country and in my constituency who say they are working. This Government is committed to retaining them when others want to abolish them.
Importantly, with regard to the outlook for this year, we have seen an increase in construction costs. We had to address that. The plan had to be flexible. That is why we brought in the waiver of the development levy and the Uisce Éireann connection charge refund - to reduce the cost per unit on average between €50,000 and €20,000, depending on whether the property is a house or an apartment. That has led to that increase in commencements.
There is no plan comparable to Housing for All, and it is fully funded. That is the thing that has been really important because it gives the local authorities, the AHBs and all stakeholders, including the private sector, the certainty that the money is there. Others said they would produce a plan over a year ago but have not done so. We still have not seen that.
I was in Brussels last week for a meeting of EPOCH. Let us compare construction across our EU partners. This is important to see where we are going.
There are very serious housing issues in all EU countries. We are the only country out of 19 in which construction grew last year. This year it is projected to grow more than 4.4%, according to the Euroconstruct report. One of the reasons for that, which was put very clearly in this independent report, is State investment. It is the State leading by example with that €5 billion investment. Yes, we do need private investment, too, because to deliver the homes we need, we probably need between €13 billion and €14 billion per annum. As our population increases, we will need more. That is why we need a sustainable construction sector that is delivering really good quality homes for people.
With regard to the targets, work is being done by the ESRI on population growth. Thankfully, our population is growing substantially now, so that has to be assessed as well. We will basically assess the ESRI data and the work that is being done by the Housing Commission. In quarter 2 of this year, I expect that we will come forward with the revised targets for the next number of years to 2030.
I thank the Minister for his answer. It is clear that this is a problem that cannot be solved without State investment. That is why underlying the Housing for All plan is a commitment that we are going to invest significant amounts - €5 billion per annum as he indicated - in trying to increase housing in the country.
There is another sphere, which is the people who have not been able or who do not want to get on the housing ladder. Not everyone wants to commit to buying a house at certain stages in their lives. They are the people in the rental sector. We increased the rent tax credit to €750 in the budget. What is the Minister's view on what more can be done in the rental market? Does he think this is purely a matter that is within the control of the Department of Finance and the budgetary process or is it the case that with an increasing number of units being built and the increased supply will ameliorate the problems many renters are finding in society at present?
The Deputy is correct. There are many people renting who do not want to rent, although some at different stages of their lives will. That is why we took a measure to increase the renter's tax credit to €750. Between 2022 and 2023, that is €1,750 per renter back in their pocket.
The private rental market is not functioning as it should. That is why we must ensure that we try to keep good landlords in the market. That is why this Government brought forward measures to reduce costs for good landlords that are in the market. They are modest but on the basis of landlords keeping their properties in the market. That is where we have seen much of the pressure with landlords exiting the market. We have to fill that hole with cost-rental homes, which, thankfully, we are doing, and affordable purchase homes from approximately €166,000.
There are others who would remove completely that modest support to retain properties in the private rental sector. Last week, a motion tabled by the main Opposition party was quickly withdrawn and replaced by a Private Members' motion on the RTÉ licence fee this week. It kind of shows the priority others have with regard to stabilising the private rental market.
