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Local Authority Housing Mortgages

Dáil Éireann Debate, Tuesday - 19 June 2018

Tuesday, 19 June 2018

Ceisteanna (137)

Micheál Martin

Ceist:

137. Deputy Micheál Martin asked the Minister for Finance the amount of the €750 million allocated to Home Building Finance Ireland for 2018 that will be drawn down in 2018; if there is an expectation that it will be underspent; and if he will make a statement on the matter. [26345/18]

Amharc ar fhreagra

Freagraí scríofa

Home Building Finance Ireland (HBFI) is to be established to provide funding on market terms to viable residential development projects whose owners are experiencing difficulty in obtaining debt funding. The legislation establishing HBFI, the Home Building Finance Ireland Bill 2018, was published on 18 June 2018 and will now commence its passage through the Oireachtas. It is envisaged that the HBFI legislation will be enacted before the summer recess, and HBFI will begin lending before the end of 2018.

Up to €750m of funds from the Ireland Strategic Investment Fund (ISIF) will be allocated to HBFI to provide funding on market terms and the fund is estimated to have capacity to finance about 6,000 homes in the coming years. This €750m will be composed of a combination of equity and loans.

Upon incorporation the Minister will provide equity of €20m which will be used to fund HBFI’s initial start-up costs. ISIF will then be directed to lend the remaining funding, of up to €730m, to HBFI at a market rate of interest in order to fund delivery of residential property. It is envisaged that this funding will be delivered in installments on receipt of funding requests from HBFI, the exact scale and timing of these requests will be dependent on market demand.

The portion of HBFI's debt funding to be drawn down in 2018 has not yet been finalised but will be determined after careful market analysis to determine that it will be commensurate to market demand.

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