Dáil Éireann Debate, Thursday - 10 November 2016
53. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which he is satisfied that the first-time buyer grant provisions will not inflate house prices or if an alternative methodology might be required to assist first-time home buyers; and if he will make a statement on the matter. [33991/16]
Amharc ar fhreagraMy officials considered the potential impact of the Help to Buy incentive as part of their analysis of the proposal and the design of the relevant parameters of the incentive. A straightforward analysis of the Help to Buy scheme in isolation might suggest that it would increase prices, but this does not take on board the other impacts on the housing market that will arise as a result of the 'Rebuilding Ireland: Action Plan for Housing and Homelessness', which was launched last July.
This comprehensive Action Plan takes a holistic approach in addressing the many interacting structural constraints affecting the housing market in areas such as planning and land use, as well as regulation and skills deficits in the construction sector. While the primary focus of the Action Plan is to tackle structural constraints, fiscal supports can play a supporting and time-bound role in addressing the current problems in the housing sector.
It is in this context that the Help-to-Buy scheme should be considered. Its role is to complement the other measures in the Action Plan. The extent to which the scheme could lead to an increase in residential property prices will very much depend on the speed and efficiency with which structural supply constraints are eliminated and residential building activity increases. Therefore, the impact of the Help-to-Buy scheme on property prices cannot be considered in isolation from the impact of other measures contained in the Action Plan, which are primarily designed to increase supply.
