Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

The help-to-buy initiative has been in operation since January 2017. The scheme is designed to assist first-time buyers with obtaining the deposit required to purchase or build their first home. With a view towards increasing the supply of new housing, the relief is only available in respect of new build or self-build properties.

Following its introduction in budget 2017, and as a result of debate on the issue on this Stage of the Finance Bill last year, Deputies will be aware that Indecon Economic Consultants was commissioned to undertake an assessment of the scheme. The terms of reference for this review included an examination of whether the policy objectives on the supply of new homes are being met, what impact, if any, the scheme is having on new and second-hand house prices, and what impact the scheme is having on the residential property market generally.

The review was published as part of the budget documentation on 10 October. It found that, to date, the incentive has not had a measurable effect on house prices, while it is meeting its objective of assisting first-time buyers of new homes to fund the deposit required under the Central Bank's macro-prudential rules.

The report found that the supply of new homes was increasing modestly. While the help-to-buy initiative does not appear to have had a direct impact on these supply levels to date, the report also noted it may be too early for this to have become apparent. On the basis of these findings, and considering that the incentive has only been in operation for less than a year, I decided to allow the measure to continue in its current form for the coming year, subject to it being closely monitored and with a view to taking stock again prior to budget 2019. In addition, the Revenue Commissioners publish monthly statistical reports on the cost of the help-to-buy scheme. Its reports include the numbers of claims made, approved and paid, as well as breakdowns of the figures by metrics such as property value, loan-to-value ratio, and property type. It also includes a geographical breakdown of claims by county.

My Department reviews taxation measures on regularly as part of the budgetary process. Given the extensive nature of the Indecon report into the scheme, as well as the detailed statistics on the scheme published by Revenue on a monthly basis and the analyses undertaken by my own officials, I do not propose to accept this amendment.