Fergus O'Dowd (Louth, Fine Gael)
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Question 109: To ask the Minister for the Environment, Heritage and Local Government the plans his Department has to encourage so-called empty nesters to trade down to smaller properties; and if he will make a statement on the matter. [31194/06]

Noel Ahern (Dublin North West, Fianna Fail)
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Prevailing house price differentials mean the environment is generally favourable for people who wish to trade down to smaller homes. Ultimately, this is not merely a financial matter, but rather a question of personal choice, depending on a household's circumstances and on connections to wider family and community. Our strategy has and will continue to be to increase housing supply to meet the diversity of demand. The residential density guidelines for planning authorities, issued by my Department six years ago, highlighted the need for a mix of dwelling types. The increased availability of a range of size and types of dwellings in new residential developments should assist people who wish to move to smaller homes in the same neighbourhood.

The Government is committed also in the social partnership agreement Towards 2016 to increasing the mix of dwelling types of good design across all tenures. Investment over the period 2007 to 2009 will enable increased output from social and affordable housing measures. This will include sheltered housing, which is an option for people on lower incomes who find that their accommodation no longer meets their needs. Already a number of local authorities operate "financial contribution schemes" under which private housing is part-exchanged for social rented accommodation specifically designed for older people. In addition, the voluntary and co-operative housing sector may use the discretion available to it under the capital assistance scheme to allocate up to 25% of units in its projects in a similar fashion.

Fergus O'Dowd (Louth, Fine Gael)
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The CSO quarterly national housing survey has shown there are approximately 50,000 people living alone in houses with four or more bedrooms. Obviously they are not all elderly but a significant number is elderly. Many retired people, over the age of 65, are living in homes they can no longer maintain. These people are asset rich but cash poor. I ask the Minister of State to look again at this issue. The supply of housing can be increased if we can find it attractive for people to move to smaller houses. I acknowledge the commitment from some local authorities to assist that process. As many new first-time younger buyers want to get on the market and 50,000 elderly people are in houses of four or more bedrooms there is an inequality in terms of market supply. If more people can be attracted out of those homes and into smaller homes and assisted in whatever way possible, that would be socially just, would be a constructive policy and would increase the supply of housing so that young families can get into the market. That is one of the issues that needs to be addressed. Will the Minister of State consider schemes for retired people over the age of 65 and ask his Department to research this area to make it more attractive for people to trade down?

Noel Ahern (Dublin North West, Fianna Fail)
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I know the theory of what the Deputy has said. He did not mention it but he is probably trying to introduce a reduced rate of stamp duty. One can make a theoretical argument for the point the Deputy has made. These things can be done by the carrot and the stick. Some countries might do it by the stick by imposing rates or a property charge on elderly people which would force them out of their homes. Certainly we have not done that and will not do it. We do it with the local authorities under the financial contribution schemes. Much of our emphasis is on the first-time buyer who is going for these smaller homes. While what the Deputy has said is reasonable and I can understand it from one point of view, at the same time I would not like it to be too successful because it might put pressure on the shortage of smaller homes for first-time buyers. We now have a better mix of developments. There is a better range of house-apartment types in new developments. At the end of the day it is not just about a carrot to encourage them to trade down. There are many factors involved. I agree there are many people in four or more bedroom houses and one may ask why they do not trade down. They have raised their families there and it is not always the couple of quid that encourages them. There are other factors. I know what the Deputy is getting at but we would need the support of the Department of Finance to encourage it. If it was too successful I would be nervous of it putting extra pressure on the first-time buyers' market.

Fergus O'Dowd (Louth, Fine Gael)
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I understand the Minister of State's reply but the key point is to assist retired empty nesters to trade down should they so wish and thus make more homes available in the market place. One of the problems is supply and making affordable homes available. I agree with the Minister on the need for a mix in social and affordable housing. Will the Minister of State agree that, perhaps, we ought to ask local authorities to examine the centre of their urban communities, particularly vacant sites that could be made available, and designate them and at the planning stage insist they make more affordable housing available to retired people? That would encourage such people into the centre where the services are located. Also the houses would be cheaper because they would be smaller. That would be socially just and it would be a constructive policy for the Government to look at.

Noel Ahern (Dublin North West, Fianna Fail)
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I am not dismissing the Deputy's idea. I know the idea and have often talked about it. It is done under the financial contribution schemes where, certainly in the city, people are selling their houses back to local authorities at prices ranging up to €450,000. The scheme exists at that level. Depending on one's age one makes a financial contribution. Currently the scheme does not exist for houses valued at more than €450,000. Under the new partnership agreement, a working group is being set up to look at more integrated living for older people which would provide care plus housing. Various aspects of it are being examined. The voluntary sector will be involved in that side because there are older people who want to move into accommodation with independent living in the shorter term but which might have options for care. Different ideas are being examined and expanded on. Given that a working group is to be set up under the new partnership agreement to look at that aspect I do not dismiss what the Deputy says.

Fergus O'Dowd (Louth, Fine Gael)
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It needs to be examined further.

Noel Ahern (Dublin North West, Fianna Fail)
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One would need to tread carefully because the whole market is finely balanced. If it was too successful, one could solve one group's problems but create a shortage in another area.