Fiona O'Loughlin
Ceist:222. Deputy Fiona O'Loughlin asked the Minister for Finance the status of a review of the help-to-buy scheme; and if he will make a statement on the matter. [1257/19]
Amharc ar fhreagraTuesday, 15 January 2019
Ceisteanna (222)
Freagraí scríofa
Last year, I commissioned an independent Cost Benefit Analysis (CBA) of the Help to Buy (HTB) incentive. Following a competitive tender process, Indecon International Economic Consultants were appointed to carry out this analysis. The report of the CBA was published at Budget time in the Department of Finance Report on Tax Expenditures and is available on my Department’s website.
In brief, the report found as follows:
- Prices: While there may have been a very small increase in prices attributable to the introduction of the incentive, the primary driver of house prices remains the continued misalignment between demand and supply.
- Supply: The evidence suggests that following the introduction of the incentive there was a marked increase in supply which can be attributed in part to HTB.
- Affordability: The analysis also finds that availability of HTB has reduced the time to save for all claimants and improved the overall affordability of housing for these individuals.
- Benefit/Cost Ratio: The analysis finds a benefit-cost ratio of 1.28 indicating a moderate positive effect for the incentive but note that if the price of new HTB units was to increase due to the incentive, the net benefit would be reduced.
The incentive is due to expire at the end of the current year and will be subject to decision in the context of Budget 2020.