Mr. Maoilíosa Reynolds:

I will come to that in a second.

There are approximately 42,000 mortgages in arrears of 360 days or more, based on the Central Bank information. That is approximately €119,000 each. Let us assume, being pessimistic, that we borrow at 4%, that is €5 per €1,000. If I was a bit younger and bought a 30 year term in the morning that is what I would pay. That would cost me €595 a month. The housing assistance payment, HAP, scheme for Dublin is approximately €1,250 a month for a two bed dwelling. This proposal offers the possibility on a very large scale of purchasing State-aided housing at half the current price of HAP. That would save a considerable amount of cash.

The Central Bank confirmed that there are approximately 33,000 homes in arrears of two years or more. The Rebuilding Ireland target is 32,000 rental units as "social solutions" over the next five years. Of the 47,000 target, 32,000 are rentals, either long-term leased part fee or social rental units. In a really crude cost-benefit analysis the structure being proposed here could alleviate the tsunami of difficulties we are talking about and deliver the entire Rebuilding Ireland target for probably half the budget in a short time.

To put the numbers in context, we hear about one in ten mortgage arrears, 73,000 homes in arrears in total. In Dublin there are 1,300 rental properties and, according to the last DAFT report, there are 3,100 in the country. If even 10% of the 14,367 buy-to-let mortgages that are in arrears for two years or longer hit the market in any year they will probably be sold with vacant possession to try to increase their value. A total of 1,500 tenants will be put out for a temporary period of six months. Given how few rental properties there are, that has the capacity to completely distort the rental market, particularly in Dublin. This will have an enormous effect. This is not hundreds of thousands of repossessions, it is relatively few repossessions that are half the total rental stock at the moment. It is a real immediate problem.

We know from accurate indicators that we are losing houses year on year because our new build levels are so low. We built approximately 3,500 new homes last year in total and 553 of those were ghost estate units that had started in 2010 and were completed. Last year we lost approximately 950 homes in terms of our overall totals to stock. In the past two years it was 2,750, taking other accurate indicators. Our supply of houses is pretty well flat. We know that from the Central Statistics Office, CSO. We have a very small pool of rental properties and there are 33,000 houses of borrowers who have been in distress for two years or longer and 14,000 are buy to lets. Even in this room we said we were talking only about people and their homes. The buy to let arrears are probably the biggest single danger to the rental market at present. These could easily be funded.

On the one hand, there is a mechanism, whether it is an EU bond or off or on balance sheet. In 2013 the former Minister of State with responsibility for housing, Deputy Jan O'Sullivan, introduced the concept of a bond in conjunction with Focus Ireland and Key Capital. It was secured. The State agreed to relinquish first charge on existing State-owned homes.

The bond was floated at €39 million in Ireland. That was too low. Five lenders were approached. It never flew. That bond is in a drawer. It could be taken out and a zero or two could be added, the name could be changed from the name of the special purpose vehicle, SPV that was there, and it could be floated and funded for 4% or 5%. The structure is very similar to the structure in this proposal. I thought it was the same thing when I read this. The international bond market is looking for bonds in excess of €200 million. They do not want small ones. A €1 billion bond is great. There is plenty of juice in there for all the bond guys, the average cost for a tenant to rent a house here would be €600 or €700 a month and nobody loses out. There is a really compelling financial argument for this. We know that the numbers stack up in terms of its funding itself. We are buying at a huge discount which has already been written down. The only difference is that the co-op, not a private offshore fund, gets the benefit of the write down. The question for me is not whether this will fly financially but how will those profits be refloated or returned to the economy in the most efficient way possible, for example, funding new social housing or Part V housing. This is a complete no-brainer in terms of the immediate pressures on the rental sector from a relatively small number of repossessions to the benefits and the actual cost to tenants and people in place.