Darragh O'Brien (Dublin Fingal, Fianna Fail) | Oireachtas source

I will try to explain a few things in order to be helpful to Deputies. I will refer back to Deputy Boyd Barrett first, and then the other Deputies. We are dealing with the reality of the situation right now, which is that housing is not affordable for tens of thousands of people across the State. This legislation will bring about a national affordable purchase scheme and, pretty much for the first time ever, a national cost-rental scheme. I will give an example. Some people might not like to hear a reference to "market price" but, to give an indication of affordability, I must mention that the first 25 cost-rental homes were launched yesterday at about 50% less than the market price charged for rent in that part of north County Dublin. We can say that this is a comparison. We are not setting the regulations based on a reduction in market price. We know what cost rental is. It is a rent charged on the basis of covering the costs of the development, maintenance and management of a particular development.

Deputy Cian O'Callaghan will certainly be aware that in other European jurisdictions they are not just not-for-profit; they allow ethical investment, such as in Vienna, where a small margin is allowed. With cost rental in Ireland we are funding the start of this through Exchequer funding.

In Balbriggan, as of yesterday there are rents of just short of €900 a month.

I will go further with regard to the regulations and when they will be introduced. When regulations are published they are laid before both Houses, as I said, and any Deputy can seek their annulment. I agree with Deputy Boyd Barrett. It is not just a question of setting a market price or a discount off a market price for affordable purchase. I have never said that. What is affordable to a person or family unit is what is affordable.

I want to be helpful on this. While I understand why it might be attractive, the provision of a single and absolutist indicator does not provide the most insightful or helpful response to the fundamental question of what is affordable. Deputy Ó Broin published a scheme a couple of years ago. This is a completely new Bill brought forward by the Government. The affordable housing policy brought forward by his party would have capped entry to the scheme if a person earned more than €50,000 as an individual or more than €75,000 as a couple. That is arbitrary. The figure was changed to €80,000 for a couple following some criticism. We need to point affordability at the family unit and individual.

There is very little academic support for an affordability measure that concentrates on averages alone. This is because different groups can experience very different conditions. Assessing affordability and the financial constraints on households is not best identified by a rule of thumb or asking how much is too much, but rather by asking how much is too much for whom and in what circumstances.

I completely agree with the Deputy. That is what this will be focused towards. I will explain when this will happen. A number of Deputies understand that there is no one-size-fits-all. If I introduced a regulation that stated a person earning, as Sinn Féin proposed, in excess of €50,000 could not access an affordable house, I do not think anyone would have agreed with that. It would be a completely unworkable, arbitrary and unfair proposal. The main Opposition spokesperson has advocated such arbitrary caps.

This Bill will be better because it will take into account family needs and a household's particular financial circumstances. I want to broadly confirm that it is my intention to provide that households can apply to purchase what would be modest family homes using the mortgage available to them when they cannot afford the home in question at the value that is being sought. Where equity support is being made available, families can bridge the gap between their mortgage funding and the price of homes, and they will be eligible for that support.

I have previously indicated that, based on local authority submissions under the serviced sites fund, which will become the affordability fund, it is envisaged that homes made available by housing authorities under the scheme will have purchase prices of between approximately €160,000 and €300,000. We have seen this in areas across the country. That will give Deputies an indication of what we are talking about.

Some of the schemes we launched in Lusk involve prices of between €165,000 and €265,000. The scheme in Ballymastone in Donabate has houses priced in the region of €265,000. Two Members who spoke to this amendment have colleagues in Fingal County Council who opposed the scheme. That is fine and they are entitled to do that should they wish to do so. This is about delivering affordable homes for people.

This involves house prices in approximately that region. As we deliver more we will be able to build up that scale. A home costing €160,000 is within the range of applicants with incomes as low as €29,000 for a single person or gross €27,000 for a couple with two incomes. That involves using a Rebuilding Ireland home loan, which we intend to be part of this. In the case of applicants using bank mortgages, the home is accessible for applicants with a gross income of approximately €42,000. I am giving this information to Deputies to try to be helpful. Most of us will agree that people who feel they will never be able to own a home will be part of such schemes. We will have the same type of arrangements for cost rental.

At the upper end, a home costing €310,000 is accessible for a couple with a gross income of approximately €54,500 using a Rebuilding Ireland home loan or a couple earning a gross income of just short of €79,700 if they are using a bank loan a mortgage. The reason for that is that the macroprudential rules, as they apply, are more liberal under the Rebuilding Ireland home loan because it is a long-term fixed rate mortgage. We will examine how we can integrate that better.

I want to be helpful to Deputies and outline when we will publish the regulations. Homeswill become available in the coming months. I expect the cost-rental homes in Balbriggan to have tenants within the next eight weeks. On cost rental, I expect the regulations to be published in advance of that. It is now July and the regulations for both will be published by September. I have given Deputies a flavour of how they will work.

We need to have a degree of flexibility for people and families who want to own homes or rent a cost-rental unit for the first time in this country. We need to determine how this works. The main Opposition party advocated for arbitrary salary caps. If we hardwired that into the Bill, we would have to pass an amendment to change that. Would we add 10% or 15%? Would we not allow flexibility for different affordability levels in different parts of the country? That is why the regulations are flexible. They can be brought before the Dáil or Seanad and discussed. It is a better, and more flexible and efficient, way of doing it, which means that the Dáil and Seanad, with the best intentions in the world, will not further delay the process and provision of affordable homes.

I say respectfully and genuinely that I understand why the two amendments have been tabled. Deputies have explained their reasons. I have given them not just my view, but how the operation of these schemes will work and why it is better and appropriate to do it in the way I am suggesting. For that reason I cannot accept either amendment.

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