Dáil Éireann Debate, Tuesday - 10 October 2017
745. Deputy Michael McGrath asked the Minister for Housing, Planning and Local Government the changes that have been made in 2017 to the mortgage-to-rent scheme; his plans to further modify the scheme; and if he will make a statement on the matter. [42441/17]
Amharc ar fhreagraThe Review of the Mortgage-to-Rent, MTR, Scheme, published on 8 February 2017, introduced a range of amendments to the eligibility criteria and administration of the MTR scheme in order for it to work better for borrowers.
The review, available at the following link: http://rebuildingireland.ie/news/changes-in-mortgage-to-rent-scheme/, explored the avenues and impediments to participation in the scheme and recommended a number of actions to make the scheme work better for borrowers. Key changes include:
- Lenders are now required to formally communicate with borrowers as to why they are not suitable for the scheme;
- The property price threshold for a house in Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow has been increased to €365,000 (from €350,000), while the threshold for an apartment/townhouse in these areas is being increased to €310,000 (from €300,000). For the rest of the country, the threshold for a house has been increased to €280,000 (from €250,000) and for an apartment/townhouse to €210,000 (from €190,000).
- Flexibility has been provided in relation to the size of properties which qualify for the scheme. In practical terms, this means that an assessment of the property size suitable to a particular household now allows for a maximum of two additional bedrooms in the property above the actual needs of the household, with the property still being considered eligible.
- The administrative process has been streamlined including certain steps of the MTR process now being required to be completed prior to the submission of a completed MTR application to the Housing Agency.
- There are a number of actions to improve knowledge and understanding of the scheme. A range of state agencies are being facilitated to assist and guide borrowers who could benefit from the scheme.
My Department and the Housing Agency are working with all stakeholders to ensure that the actions set out in the Review are being effectively implemented to benefit a greater number of households.
The Review also concluded that the current financial model of the MTR scheme may not, in its current configuration, be capable of delivering the scale of successful cases that could benefit from the scheme over time. In order to test the operability of alternative funding models for the scheme, the Housing Agency has been working with a number of financial entities who have expressed an interest in working with the MTR scheme to progress a number of alternative long-term lease arrangements. In advance of these pilots and to establish the operability of an alternative financing approach, a targeted market testing exercise has been undertaken by the National Development Finance Agency, NDFA, to test the suitability of the proposed enhanced leasing arrangement to ascertain if they would be viable for a MTR cohort, taking account of the necessity to provide a long-term stable solution for eligible households.
The responses to the market-testing exercise have been reviewed by the Housing Agency and my Department, and the next step is to issue a formal call for Expressions of Interest from bodies interested in pursuing pilot operating models. Once the Expressions of Interest process is concluded, the Housing Agency will make recommendations to my Department as to the make-up of the pilots which can then be initiated. The drafting of the content of the Expressions of Interest Request is underway and is expected to issue shortly.
