Dáil Éireann Debate, Thursday - 15 February 2024
235. Deputy Aodhán Ó Ríordáin asked the Minister for Housing, Local Government and Heritage if he is aware that a single person earning €57,000 gross , or €41,500 net, does not qualify for a one bed unit in a Land Development Agency cost rental scheme and yet is also excluded from social tenancy given the €40,000 income threshold; and the action he will take to remediate the situation. [7210/24]
Amharc ar fhreagraCost Rental is a form of rental tenure designed to assist a cohort of renters who face significant affordability challenges meeting high rents in the private sector and who are not eligible for social housing support. The core principle of Cost Rental is that the rents cover the development, management, and maintenance costs of the homes, so that the long-term future of the homes is financially secure, but that rents are not subject to the pressures of the open market. Unlike market-driven rents, Cost Rental prices only increase in line with consumer inflation, providing stability while meeting ongoing expenses. Additionally, Cost Rental homes offer long-term, secure tenancies regulated by the Affordable Housing Act 2021.
The primary eligibility condition for accessing Cost Rental housing is a maximum net annual household income (less income tax, PRSI, USC, and superannuation contributions). This was originally set, for the whole country, in December 2021 at €53,000, these limits were adjusted to €66,000 in Dublin and €59,000 elsewhere in August 2023, acknowledging changing economic circumstances.
Since rents must cover costs, a Cost Rental landlord must be confident that a prospective tenant can afford to pay the rent every month over the long term. Therefore, under the current legislation, a Cost Rental landlord has final discretion on whether to enter into a tenancy agreement with any particular applicant.
Regarding social housing, income thresholds were increased by €5,000 for all local authorities from January 1, 2023, based on a 2022 review conducted by my Department. The new thresholds are €40,000, €35,000, and €30,000 for bands 1, 2, and 3 respectively. Notwithstanding these changes, my Department is awaiting detailed research examining the existing income limits in the context of current market and population conditions and the suitability or otherwise of the current framework having regard to the significantly changed landscape since it was introduced. This has been commissioned by the Housing Agency and I understand this work is near completion. When it is available, my Department will undertake a detailed examination of the report, including consultation with stakeholders. This will facilitate the preparation of options for my consideration later this year as set out in the Housing for All Action Plan update.
