Eoghan Murphy (Dublin Bay South, Fine Gael) | Oireachtas source

I move amendment No. 2:

To delete all words after "That Dáil Éireann notes" and substitute the following:"— the very significant impact that the economic downturn had on housing supply and the construction industry, with housing construction falling by over 90 per cent between the peak in 2006 and the trough in 2013;

— that with the economy returning to significant and consistent growth, and with the unemployment rate at 5.8 per cent in May (its lowest since May 2008), a significant increase in the supply of new homes is needed;

— that, having regard to this, the Government has made the delivery of new homes across all tenures - social, affordable and private, a top priority through the development, resourcing and implementation of the Rebuilding Ireland Action Plan for Housing and Homelessness;

— that the Government’s initial focus has been on delivering homes for households in the lowest income brackets, through the commitment of over €6 billion to deliver 50,000 new social housing homes by 2021, with eligible households also able to avail of the Housing Assistance Payment (HAP), the Rental Accommodation Scheme (RAS) and other targeted programmes, with the aim of meeting the housing needs of over 137,000 households under the Rebuilding Ireland Action Plan by the end of 2021;

— that almost 26,000 households had their social housing needs met in 2017, exceeding the target set by 23 per cent, and almost doubling the levels achieved in 2015;

— that the social housing construction programme included some 850 schemes (or phases), with 13,400 homes in the pipeline, at the end of 2017, almost 5,000 more than a year earlier;

— the 2018 target for all building programmes across local authorities and Approved Housing Bodies (AHBs) of 4,970 homes, more than 50 per cent higher than the 2017 target;

— the changes made to Part V of the Planning and Development Act 2000, in 2015, which were designed to prioritise social housing provision on site, and maximise its contribution to increased social housing output and the creation of sustainable mixed-tenure communities across the country;

— the important contribution made by the National Asset Management Agency (NAMA) in the delivery of social housing, sourcing almost 2,500 houses and apartments for social housing use by local authorities and AHBs;

— the wide-ranging actions taken by Government to bring vacant or under-utilised properties back into use, particularly in the cities and large urban areas where housing demand is greatest;

— the establishment of a Vacant Homes Unit within the Department of Housing, Planning and Local Government to drive and co-ordinate actions at central and local government levels and the funding and appointment of Vacant Homes Officers in local authorities to support action on the ground in identifying available properties in their area and assisting owners to bring them back into early use for social housing, private sale or rent, or where appropriate, using Compulsory Purchase Orders (CPO) and other powers;

— that a suite of measures is being implemented to facilitate increased residential construction activity and ensure the sector’s capacity to produce more affordable homes through, inter alia:

— fast-track planning reforms and more flexible planning guidelines;

— €200 million capital investment in enabling infrastructure to service/open up housing lands with proportionate affordability dividends for house purchasers; and

— the progression of large-scale mixed-tenure housing projects, with social, affordable and private housing, on publicly-owned lands;

— that the Government has also introduced targeted and time-bound measures to limit excessive rent increases (e.g. through Rent Pressure Zones), and to provide further protections and effective support services to both tenants and landlords;

— that, in Budget 2018, significant obstacles to building more homes more quickly were removed, by:

— investing more capital funding in direct house-building by the State;

— removing the Capital Gains Tax incentive to hold on to residential land, as well as escalating penalties for land hoarding; and

— providing a new, more affordable finance vehicle for builders through House Building Finance Ireland (HBFI);

— that these measures are having a positive impact, with all relevant indicators clearly showing that the supply-based measures under Rebuilding Ireland are working, with latest planning permissions and commencements data up 27 per cent and 23 per cent year-on-year respectively, and house scheme registrations up 35 per cent;

— that a new National Regeneration and Development Agency is being established under Project Ireland 2040 in line with the compact growth objective and targets in the National Planning Framework;

— the Government’s commitment to addressing the affordability pressures faced by some households, particularly low- and moderate-income households in the major urban centres, through:

— the new Rebuilding Ireland Home Loan, which provides long-term, fixed rate mortgages for first-time buyers;

— the imminent activation of a new Affordable Homes Scheme that will leverage affordable properties from publicly-owned lands;

— provision of at least €25 million infrastructure funding under the new Serviced Sites Fund, with a call for proposals to issue later this month, to deliver lower-cost affordable housing from local authority sites;

— the development of large-scale cost rental initiatives in Dublin to help deliver new homes at affordable levels; and

— new ‘Build to Rent’ and ‘co-living’ planning guidelines which will facilitate investment and innovative design of more rental accommodation at more affordable rents."

I thank the Deputies for the opportunity once again to debate this most important of issues. The motion and the countermotions speak to many different issues. Housing is after all a complex matter. I will use this opportunity to address what the Government is doing in this area. While it is a complex matter, supply is the most important aspect and, until supply hits the point at which it needs to be, controlling issues such as rent, protecting those who are most vulnerable and making sure that we have more than enough emergency accommodation available to the highest standards are equally as important.

This is not like clicking one's fingers. Deputy Murphy talked about ringing the alarm bell. The alarm bell was rung and it was heard. Rebuilding Ireland is the response to that, but as we build more homes we have to make sure that, as they are built, we do not make the mistakes of the past because we are building a home for a person's life and for at least 60 years. If one is going to build, one has to make sure that one avoids the mistakes we made in the past, including building where there is no demand for houses; building where there are no infrastructural connections or services; building where there are no local amenities; building in a way that is not compact spatially and which causes sprawl and all the additional problems that come with it; or building without considering that we are building more than just buildings, but communities as well. For that reason, mixed tenure will be important as we build into the future.

We have to build in the right way and that is a challenge even in the normal course of events. However, we did not experience normal course of events following the collapse of the economy and the construction sector in the years 2007 to 2011. Construction in the economy fell by 90%, and house prices fell by 50% and continued to fall into 2012. That is why we stood down the affordability scheme. In that year, and the years after, affordability was not an issue. Hundreds of thousands of people fell into negative equity. Many continue to be in negative equity, despite recent house price inflation. We are still 20% to 23% off the peak of house prices in the past and while the latest information is that house prices are increasing, there was a dramatic slowdown in the first quarter of this year.

If that trend continues, we will see single-digit inflation in the course of 2018. Employment in the construction sector had fallen by two thirds, with a legacy of 3,000 ghost estates. Local authorities were saddled with large land debts. This was the legacy that we inherited. It was what we had to turn around and it is what we are turning around.

In 2012, house affordability was not an issue. Negative equity and ghost estates were the issue. We needed social housing then but it had almost exclusively been outsourced to the private sector through the Part V process. That collapsed as well. Getting local authorities back into house building would take time but social house building, looking after the most vulnerable, was our first priority.

From almost a standing start with a very low base of delivery in 2013 and 2014, the Government increased the delivery of new-build social houses, with 664 having been built in 2016 and 2,297 last year. The number is expected to rise to 4,409 this year. This increase was because I took the decision last year to build 30% more in 2018 to expand supply rather than compete from existing supply for the new social housing homes. When one includes homes acquired on long-term leases, the figure rises to 7,900 new homes in 2018. I refer to real homes for real people.

Social housing is not delivered like it was 30 years ago. New technologies and new streams that complement each other are being used to deliver social housing homes into the stock of social housing and each home is a real home.

Almost 27,000 tenancies will be supported in 2018 through these new homes and through the housing assistance payment, HAP, and rental accommodation scheme. I would not have chosen to rely on HAP so much but, until new homes are built, we have to. Otherwise these people would have no homes. In 2020 and 2021, the final two years of Rebuilding Ireland, we will house more people in social housing homes than in the HAP-supported private rental sector. Therefore, we are progressively rebalancing the social housing stock back towards new-build homes - public housing delivered by the State.

By the end of the period of Rebuilding Ireland, 50,000 new homes — real homes – will have been added to the stock of social housing. This is thanks to an additional €0.5 billion that I secured last year, meaning we have a war chest of some €6 billion in taxpayers' money ring-fenced to build social housing directly as a State into the future. Under Project Ireland 2040, we will deliver almost 12,000 new social housing homes a year to 2027 at least.

This is what we are doing for social housing supply. One cannot spin these improvements negatively, even though people will try. We are going to double the number of new homes built this year. This is public money going into public housing. That is going to make a real difference for thousands of families, as it did last year and as it will again this year.

Vacancy is an important tool but it is not the low-hanging fruit people think it is. The repair and lease scheme, in its first iteration, is proof of that. The buy and renew scheme has proven more successful. People will say we have not got a strategy because we have not published it but, of course, if I did publish one, Members would then say I was just making announcements and not doing the actual work. The work is being done, however. There is a vacant homes unit in the Department and there are vacant homes officers and teams in local authorities. Vacanthomes.iehelps the public to identify potential vacant properties. There are new laws in place to tackle vacancy over the shop. There are new incentives to put vacant units back into use, and CPO powers are being used by local authorities. There are not 180,000 vacant homes to be put back into use, probably not even 10% of that number. We have, however, brought approximately 9,000 social council houses that were vacant back into use since 2014. All are homes for families and individuals to live in.

If the ESB figure is massively overstated in regard to new builds, it must be associated with vacant units coming back into use that were not connected for two years or more. Either way, it is new homes being brought back into supply.

Of course, social housing is only one part of the supply issue we face. Management of the existing stock is the other. The private market needs to be rebuilt also. Therefore, we have the new fast-track planning process, which has proven its worth over the past year, with almost 3,000 residential homes being approved through it. More than 3,000 student bed spaces were made available - that was only to April of this year. There are new guidelines to promote the building of more apartments - build-to-rent apartments in addition to co-living apartments.

We have LIHAF funding of €200 million to open up land banks to facilitate the delivery of 20,000 new homes by 2021. Home Building Finance Ireland will help small builders throughout the country to build developments with ten units or more. It will be announced very shortly having gone to Cabinet on Tuesday of this week. A new national development and regeneration agency will be established under Project Ireland 2040. The vacant site levy is in place. Last year, I doubled it for the beginning of next year, which will help with land hoarding. By the beginning of 2017 the labour force in construction had increased by least 14%. All these measures have helped to increase the supply of housing and they are working.

Planning permissions were up 27% in 2017 by comparison with 2016. Over 18,000 new homes were on site in the past 12 months, up 27% on the previous 12 months. There were just under 20,000 new electricity connections. Vacant or not, these are homes that were not being used by families or individuals but which have been used in the past 12 months. The Central Bank of Ireland is forecasting 23,000 new homes this year and 27,000 new homes next year. Registrations for larger schemes are up 41% on the previous 12 months from March 2017. These figures cannot be disputed. While there is a dispute over the actual build achieved in any given year, I did mandate work last year to make sure we could get a more accurate figure. That work will be completed very shortly.

The supply of social housing and private housing is increasing dramatically. When we consider rents and house prices, particularly in Dublin, affordability is a serious issue. It is a serious and genuine concern of the Government. The recent rent index for quarter one from the RTB is welcome. What we are seeing is a dramatic slowdown in rent price increases from one quarter to the next. There is 0.4% rent inflation nationally and 1% rent inflation in Dublin. It was 1.1% in the previous quarter. Perhaps more significantly, we saw a drop in rents in counties surrounding Dublin, namely Kildare, Meath and Wicklow.

In practical terms, the average rent for a house in Dublin rose by €1 in the past three months, while the average rent for an apartment in Dublin rose by approximately €18. Rents are still too high in almost every part of the country, but particularly in the cities and larger urban centres. The data show that rent pressure zones are working and we will continue to drive them, but they need to be strengthened. More legislation is coming to bring more transparency, accountability and affordability to the rental sector. That will be a central focus of my work over the coming weeks as we seek to strengthen rent pressure zones, the RTB and the rental sector in general.

A lot of progress has been made towards introducing the first cost-rental project of scale in one of our cities. Cost rental will become a major part of our rental landscape in the future. Of course, affordability still remains a big problem when buying, particularly in our cities. That is why, in the coming days, I will recommence the affordability Act in line with the commitment made at the beginning of the year. I issued a call to local authorities for local authority land for the serviced sites fund for affordable housing, which amounts to at least €25 million. It may be increased. This will work in tandem with the affordability commitments that have already been given for sites such as those at O'Devaney Gardens and Poolbeg. Affordability has already been achieved, as under the Ó Cualann model, between the State, through Dublin City Council, and an approved housing body. We are now going to do this at scale. These provisions will allow for the new affordable purchase scheme, which was also signalled earlier in the year. In this regard, we have identified land and finance for 4,000 affordable homes, with an additional 10,000 homes to come on local authority land alone.

In February of this year, I launched a new Rebuilding Ireland home loan, which is the new affordable home loan for first-time buyers to access 2% finance for 25 years, offering real certainty of mortgage repayments. It is estimated that this first tranche will provide 1,000 loans to give people who have deposits the opportunity to buy a home and who have been squeezed out of the market because of mortgage affordability. Over 50% of all applicants to date, including 61% of applicants in May 2018, are being approved for this new loan by the Housing Agency. It is worth noting that in the 12 months up to October last year, 67% of first-time buyers in the greater Dublin area, Cork and Galway purchased their homes for less than €320,000. In the rest of the country, 90% of people purchase their homes for less than €250,000. Clearly, however, affordability is an issue in our larger cities. These measures will tackle it.

When it comes to people who are sleeping rough on our streets, even though the number is down 40% to just over 100 people, it is still too many. Words about supply and words about protections in the rental sector are cold comfort. We have increased our supports for outreach teams. Through the cold weather initiative, we dramatically increased the number of beds and successfully brought more people into the system. The system of emergency accommodation is operated to the highest standards with our partner NGO organisations, which operate it with taxpayer funding on behalf of the State. There are more than 9,000 people in emergency accommodation, including 1,700 or more families. That is a crisis. It is my first and highest priority. Two reports are imminent and will detail new policy responses that are needed. We will get a chance to debate them in the Oireachtas committee next week. There is still a significant number of families in hotels and B&Bs. One family is one too many. Last year, more than 2,000 families exited hotels and B&Bs, the majority into homes.

We have more than 500 family spaces under our new hub programme, with 450 more to come throughout the rest of the year. The time a family spends in a family hub is dramatically less than that spent in a hotel. Presentations in Dublin have stabilised, according to the Dublin authorities.

With regard to the motion, of course I recognise there is more work to do. If we are to be successful as an Oireachtas in improving what we are doing when we introduce legislation to improve and strengthen the rental sector, we have to recognise the great gains that have already been made while of course recognising there is more work to do.

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