Paudie Coffey (Waterford, Fine Gael) | Oireachtas source

The new incremental tenant purchase scheme for existing local authority houses will come into operation on 1 January 2016. It will apply to all local authority houses, other than excluded dwellings, on which I can expand later.

The provisions of Part V of the Planning and Development Act 2000, as amended, are designed to enable the development of mixed tenure, sustainable communities. Part V units are excluded from the tenant purchase scheme to ensure that units delivered under this mechanism will remain available for people in need of social housing support and that the original policy goals of the legislation are not eroded over time.

The market value of a local authority house will be determined in the first instance by the local authority. Where the tenant does not agree with the local authority valuation, it is open to him or her to have the market value determined independently. Under the new scheme, discounts of 40%, 50% or 60% are available, linked progressively to the income level of potential purchasers. The determination of discounts based on income is a fairer and more progressive method than discounts based on length of tenancy. Once the house is sold, the local authority will place a charge on the house equal to the discount given. The charge reduces to nil over a charge period of 20, 25 or 30 years. If the house is resold within the charge period, the local authority must be offered first refusal to buy back the house and the tenant purchaser must pay back the value of the outstanding charge on the property to the local authority.

I do not intend to re-examine these measures, which are fundamental to the design of the scheme. However, I will be keeping the operation of the scheme under review.

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