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Departmental Funding

Dáil Éireann Debate, Thursday - 28 April 2022

Thursday, 28 April 2022

Ceisteanna (88)

Brendan Griffin

Ceist:

88. Deputy Brendan Griffin asked the Minister for Public Expenditure and Reform the proposals relating to financial assistance packages for first-time buyers or renovators that have been brought to his Department for costing and consideration; if he is giving consideration to any such packages; if so, when they will be available for drawdown; and if he will make a statement on the matter. [21470/22]

Amharc ar fhreagra

Freagraí ó Béal (7 píosaí cainte)

What proposals around financial assistance packages for first-time buyers or renovators are being looked at and costed by the Minister's Department? Is consideration being given to packages that may be looked at in the near future to be drawn down by first-time buyers?

As the Deputy is aware, my Department is responsible for policy on allocating public funds across each area of Government spending and ensuring expenditure is managed in line with these allocations by Departments. In this way, officials from my Department engage with their counterparts on proposals on a variety of expenditure measures, including in relation to housing. However, queries relating to housing policy are in the first instance a matter for the Minister for Housing, Local Government and Heritage, who has policy responsibility in this area.

There are a number of schemes in place aimed to support first-time buyers, in particular, under the Affordable Housing Act 2021, which has legislated for two new affordable housing schemes. The local authority affordable purchase scheme will make homes available at a reduced price for first-time buyers.

The scheme will be supported by the newly created affordable housing fund. It is currently operational and I have made €60 million available to the fund this year. Additionally, the first home shared equity scheme will be available nationwide to first-time buyers seeking to purchase a newly built home in a private development anywhere in the country. The scheme is expected to be available for drawdown later this year and €44 million is available for that in the current year. Finally, the local authority home loan is a Government-backed mortgage for first-time buyers or other eligible applicants through local authorities. The sum of €250 million is available to the scheme in the current year.

For renovators, the Department of Housing, Local Government and Heritage has a number of schemes, including the repair and leasing scheme and the forthcoming Croí Cónaithe towns initiative, which will renovate vacant homes in towns and villages. The Government is committed to supporting housing. Under the national development plan, €12 billion in direct Exchequer funding is being made available for Housing for All out to 2025.

Bridging the affordability gap and boosting supply for the provision of homes is ultimately our shared goal and it has to be our priority. I am pleased that it has such a high priority when it comes to the Housing for All plan. Many young couples at the moment are paying €1,500 to €2,000 to rent a two-bedroom apartment in places in my constituency like Clondalkin and Lucan when they would much prefer to be paying €1,000 in a mortgage for a place they would own some day. The problem is that they cannot afford to do that because they either cannot get a mortgage while saving for a deposit or they cannot find a home locally that is within their price range. The nub of the problem is affordability, and I guess that issue is fixed by supply. At the moment, demand outstrips supply. While I am pleased that the Housing for All plan aims to bridge the affordability gap and boost supply, a frustration often raised with me by constituents is that many first-time buyer initiatives only apply to new builds and we need to consider extending that to renovated homes. The Minister mentioned the local authority home loan scheme. It is positive that it now applies to second-hand homes but we need more of that to deliver change for young couples who need affordability in the housing market.

I believe there will be great interest in the Croí Cónaithe towns fund, because it will essentially involve providing grants to renovate derelict vacant properties. We all know that there are too many of them in our towns and villages around Ireland. They are located in communities where services are already in place. Many of them are in the centre of towns and villages. It seems to me that it makes great sense to invest some public money to bring them back into stock. It will also help to breathe new life into towns and villages throughout Ireland.

We are very anxious now to get the first home shared equity scheme up and running as quickly as possible. I know there is a lot of interest in it and people are looking to it as a way of bridging the affordability gap that unfortunately is there at this point in time. We are investing €4 billion a year now in direct Exchequer capital. It is the single greatest intervention of any Government ever to bring about a greater supply of social homes, affordable purchase and cost rental as well. We will continue to work with the private sector which has a very significant role to play in meeting the needs of first-time buyers and others who want to purchase a home in this country.

I welcome the shared equity scheme for first-time buyers. It is going to be of crucial importance to people. We all await the launch of further details around Croí Cónaithe. With more people now working from home, something we should also consider is that there is a lot of commercial space in cities such as in Dublin city centre which large employers might not necessarily be utilising for their workers. There is an opportunity for us to amend the legislation to make it easier for those buildings to be transformed into residential use. We need to be innovative about this. We need more homes for young people, and we need them at affordable rates. We must examine the planning legislation and grant schemes and budgets in terms of the Department of Public Expenditure and Reform that could support such an innovative approach both for those young people who are seeking to purchase but also for the Government to lead the way on this.

I compliment the Minister on his responses so far. Could a means be found to safeguard the interests of first-time buyers and young buyers by way of ring-fencing the assistance that might be available? For example, a person rang me this morning who was outbid by €100,000 for a one-bedroom apartment in the greater Dublin area. Could we somehow devise a means to ensure that the assistance available would go directly to those who are most deserving?

I thank the Deputies very much for raising those points. In regard to planning, they will be aware of the major initiative that is currently under way, which is led by the Attorney General. We are expecting new consolidated planning legislation later this year, which is a very significant step that we believe will help to ease some of the blockages that currently exist in the system and reduce the legal risk of successful judicial review applications being made.

On why schemes focus on new properties as opposed to second-hand ones, the logic is that they are designed to try to stimulate supply as well. We are seeing signs that it is working with the number of commencements increasing significantly. It is of the order of 33,000 to 34,000 on a rolling basis over the past 12 months. Supply is coming through, but that does not necessarily mean that the affordability gap is bridged, because we are seeing significant construction inflation and that feeds into the cost of delivering homes at this point as well. The Minister for Housing, Local Government and Heritage, Deputy Darragh O'Brien, is particularly keen that people who are not first-time buyers, but people who need a fresh start, for example those who have gone through a legal separation or people who have come home to Ireland, are also given an opportunity to avail of the schemes that are being brought forward. That is an important reform too.

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