Noel Ahern (Dublin North West, Fianna Fail)

Increasing house prices and mortgage interest rates mean that a greater proportion of disposable income is now needed to meet mortgage payments. Despite this affordability both nationally and in Dublin remains within the affordability limits now typically applied by lending institutions in deciding mortgage applications.

My Department's affordability index reflects the position at the end of March this year for a couple on a combined income of just under €76,000, based on the average industrial and non-industrial wage. The mortgage outgoings of such a couple represent about 29% of their disposable income. This ratio would in fact be lower if account is taken of the longer loan periods which are now on offer from the lending institutions.

The Government has taken a wide range of actions to maximise access to home ownership. The success of these is demonstrated by the fact that over 45% of new house loans last year were taken out by first-time buyers. First-time buyers pay at least 13% below the average price for a new house and significantly less for second-hand houses. Some 90% of the houses bought by first-time buyers cost less than €350,000 nationally and 75% cost less than €350,000 in the Dublin area. The availability of new financial products such as longer-term mortgages has also assisted in keeping mortgage repayments relatively affordable.

A key feature of the Government's housing policy is to promote an adequate supply of housing to meet demand. The delivery of more than 500,000 new homes since 1997 has enabled an unprecedented number of first-time buyers to access home ownership during the period. Last year 81,000 houses were built and the figure this year will be higher again — the current rate is 20% up on last year.

A number of measures to assist those who cannot access affordable housing without assistance have been put in place. These include the shared ownership scheme, the affordable housing scheme and affordable housing under Part V of the Planning and Development Acts. Eligibility and subsidy levels under the various schemes were increased in January.

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