Eoin Ó Broin (Dublin Mid West, Sinn Fein) | Oireachtas source

I thank Mr. Brett for the presentation and the supporting documentation.

If this committee is to have any value, it will identify, with the help of the witnesses, I hope, things that can be done that are not currently being done to improve circumstances, particularly for those experiencing homelessness or at risk of homelessness. We are less interested in people justifying what they have done to date — I do not mean that in a negative way — than trying to fix problems that very clearly exist. The point is not to get the delegation to repeat what has happened up to now but to try to identify whether additional steps, such as changes in policy, legislation or practice, could be taken that could assist in our making of recommendations to central government.

I will outline the key issues. First, while it is true that the overall levels of mortgage distress are reducing, there is still a very large cohort, comprising in excess of 40,000 households, in long-term mortgage arrears. That is the group about which we are really concerned because many in that group are either losing the family home or becoming homeless. They may be buy-to-let landlords whose tenants are becoming homeless.

Many of us are concerned that too few among this cohort are being offered mortgage-to-rent arrangements or split mortgages. Many of the distressed mortgages are now being sold on by the federation's members to unregulated funds at significant discounts. If those significant discounts were actually offered in the first instance to the homeowners, that might make their mortgages sustainable. I am keen to know what we can do to make split mortgages or mortgage-to-rent arrangements more available, particularly to the most distressed cohort. How can we reduce the number of mortgages being sold on to unregulated vulture funds, a practice which is contributing to the homelessness crisis?

Another issue is relationship breakdown. The most recent report from the homelessness agency showed that the largest contributor to homelessness at present is relationship breakdown. Approximately 25% is the figure given. Many of the people affected are not able to gain access to social housing supports because they are tied into a mortgage. Based on the cases I am dealing with, I note that many of the federation’s members are refusing to remove the party who is leaving the family home as part of the relationship breakdown from the mortgage arrangement. How do we deal with that to try to ensure those people who come out of the family home because of a relationship breakdown are not denied access to social housing support, thus ending up homeless?

The other issue is vacant possessions. Too many of the federation’s members are now seeking vacant possession on repossession, which is forcing an increasing number of rental tenants into homelessness. In some cases, the federation’s members are sitting on vacant properties that they have repossessed in areas of high social housing demand and will not put them on the market because they are waiting for their values to appreciate. It might not be a statistically large number of houses statewide but in certain areas of the city, it is a large number. We need to examine this. I am interested in the witnesses’ view on that.

On the supply end, representatives of the Society of Chartered Surveyors Ireland were present and said to the committee that, for them, one of the biggest problems is the high cost and difficulty for private developers of getting credit, particularly credit from banks. I am not interested in whether the federation believes that is true but wish to know how we can reduce the cost of credit to good developers who are seeking to build homes that are more affordable.

My understanding of the Central Bank’s mortgage lending rules is that part of their purpose is to break the link between house price inflation and the availability of credit. Therefore, if one tries to find a way of restricting an aspect of that credit for higher-cost homes, it will eventually bring down the cost of homes, particularly first-time buyer homes. I keep hearing a figure of €280,000, which is in the federation’s documentation, or €300,000, but the vast majority of first-time buyers are not buying houses valued worth anything close to those prices. They are buying or seeking to buy homes at prices below €220,000.

I am interested in knowing how many mortgage refusals or mortgages above €220,000 have been refused since the introduction of the new rules on the grounds of people not having a sufficient deposit. I am not convinced that this is actually causing the kinds of problems that arise in terms of restricting access to purchasers. I have yet to see any data. If they exist, I would be interested in seeing them.

While the Central Bank's rules clearly create difficulties for those first-time buyers who are purchasing homes valued at more than €220,000, there is a certain degree of prudence in what it is trying to do, which is to reduce the overall amount of borrowing that people require. Surely, from the banking point of view, given where we have all come from in the past 15 years, that is a prudent course of action. I am interested in knowing whether the federation agrees with that.