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Social and Affordable Housing

Dáil Éireann Debate, Tuesday - 6 November 2018

Tuesday, 6 November 2018

Ceisteanna (1173)

Clare Daly

Ceist:

1173. Deputy Clare Daly asked the Minister for Housing, Planning and Local Government if under the enhanced long-term social housing leasing scheme, developers will be allowed to use their approval for 25 year leases by local authorities as backing in order to obtain development financing; if there is a policy on such pre-approvals; and if he will make a statement on the matter. [44985/18]

Amharc ar fhreagra

Freagraí scríofa

A range of housing options are necessary to ensure a supply of accommodation to meet different types of social housing need. Harnessing the off-balance sheet potential of private investment in social housing is an important objective of the Government and the social housing targets set out in Rebuilding Ireland over the period to 2021 reflect the ambition in that regard.  

My Department has introduced the Enhanced Long Term Social Housing Leasing Scheme in order to target newly built or yet to be built houses and apartments for long term leasing, and to target property developers and investors who are in a position to deliver housing at a reasonable scale in order to supplement delivery under Pillar 2 of Rebuilding Ireland.  

A key aspect of the Enhanced Long Term Social Housing Leasing Scheme is that the proposer will finance 100% of the cost of delivering the homes.  All arrangements for the funding and financing of such proposals are a matter for the individual proposers, who will bear all financial risks in this respect.  

An Agreement for Lease will only be signed where the Housing Agency and the relevant local authority are satisfied that the proposal meets the fundamental criteria set out in the Call for Proposals documentation (which is available at http://rebuildingireland.ie/enhanced-long-term-social-housing-leasing-scheme/ ).

Committed funding is a condition for entry into a lease agreement with a local authority. Proposers are required to provide a brief summary of their strategy to source committed funding to meet their development and lease obligations to include, without limitation, delivery of homes and delivery of the services under the lease.  The Housing Agency, which has responsibility for overseeing and managing the assessment process, assesses this information in consultation with the National Development Finance Agency (NDFA) in order to ensure that the proposer has the capability to deliver both the units themselves and their obligations under the lease. This assessment is carried out in advance of any acceptance into the scheme and the signing of any agreements. 

As it is targeted at newly built or yet to be built properties, the Enhanced Leasing Scheme includes the provision for an Agreement for Lease document to be signed in advance of the commencement of construction.  The Agreement for Lease places an obligation on the property owner to meet specific conditions in respect of the property before any lease is executed, thereby guaranteeing the delivery of the units as agreed by an agreed date.  

The Housing Agency also operates a “Pre-Planning Suitability Assessment” process in order to provide information to relevant parties as to the suitability of their site and proposed development for inclusion in the Scheme, in advance of obtaining planning permission.  

The Pre-Planning Suitability Assessment process is designed to allow prospective applicants the opportunity to establish if a proposed development may be considered potentially suitable for inclusion in the Enhanced Long Term Social Housing Leasing Scheme. The Housing Agency will engage with the relevant local authority in respect of a particular site or sites and will inform the proposer if it would be likely that a proposal would pass or fail an assessment under the terms of the scheme if it were put forward formally with the benefit of planning permission. 

This process has no material bearing on any other statutory process (e.g. the Planning process) and it is explicit in the terms of the scheme set out in the Call for Proposals document that an indication of the suitability of the proposed development through this process should not be considered as confirmation of its acceptance or otherwise to the scheme. Submissions are only accepted on lands with the relevant in-principle planning policy support and all proposals will be required to be re-assessed in full, including confirmation of funding arrangements, once planning permission has been obtained, in line with the terms of the Scheme.  Consequently, any financial decisions made on the part of the proposer on foot of an assessment at this stage are made entirely at its own risk.

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