Joan Burton (Dublin West, Labour) | Oireachtas source

I move amendment No. 49:

In page 20, between lines 25 and 26, to insert the following:

“8. The Minister shall, within one year of the passing of this Act, prepare and lay before Dáil Éireann a report on the impact of section 477C “Help to Buy” on prices for new houses in the property market inclusive of an econometric analysis of the scheme.”.

To some degree much of the detail has already been discussed. I would like the committee members to consider a report within a reasonable timeframe to see what is happening in terms of building. The second part of the previous discussion was concerned with costs. In the work of the committee, this could be shared jointly with the finance committee. However, the Committee on Budgetary Oversight had the services of DKM, which had access to the different Departments.

The Minister has made a reasonable point that much of the information on housing costs and so on that we are discussing is really located in the Department of Housing, Planning, Community and Local Government rather than being held in any great detail in the Department of Finance. If, by Report Stage, we had worked out a framework in which to conduct this study, it could be an important contribution.

I looked at some websites detailing house prices in parts of Dublin. In Castleknock there are three-bedroom houses priced at €500,000. They are very insulated. In some cases four-bedroom houses are selling at €620,000. On the western side of Dublin 15 there is a large area of land which is a special development zone. It has had planning permission for long period of time and has scope for 3,000 homes, which is the equivalent of two small new towns or villages.

There is a critical issue that relates to the Ministers for Finance and Public Expenditure and Reform which may be relevant to the Committee on Budgetary Oversight. While the previous Government gave a capital allocation to effectively allow for the development of the necessary infrastructure such as roads and so on before the sites could be developed, the funding made available to Fingal is nowhere near enough to provide for all the possible developments that could happen, which are ready to go and are beside existing developed areas. Carrickmines could be the same; I do not know the area as well. This is a real problem. The Fingal county manager has advised that until there is access into the land and certain key features are developed, we will not get the houses built.

I know this is not directly the subject of the Finance Bill. However, if we are trying to get this thing kick-started and follow on from all the very good work the housing committee did, it should be possible to use a group of external consultants and use the Committee on Budgetary Oversight or the finance committee to actually do it. I make that proposal; the Minister will have to give it some thought.

I am not sure if I heard the Minister correctly. I believe he spoke about the strategic investment bank. Did I hear him suggest that the borrowing rate for the medium-sized developers, I mentioned earlier, was 12%? Is that given by way of preference loans, equity-type loans, with a lower risk factor? In the context of where interest rates are at the moment, 12% is very high. I am very aware that Deputy Michael McGrath has raised that issue on a number of occasions. If we want builders to build, we also need to address that matter. A rate of 12% is very high and certainly much higher than comparative rates of interest throughout Europe.

Various information-gathering studies are necessary. Doing them and getting genuine comparators on the cost of new homes would be extremely helpful in identifying where we can get stuff to go.