Tuesday, 4 December 2012
Ceisteanna - Questions - Priority Questions
National Asset Management Agency
To ask the Minister for Environment, Community and Local Government if he has explored the possibility of lease agreements with the National Assets Management Agency housing which would result in properties over time coming under the ownership of local authorities and remaining within the social housing system. [54241/12]
Since December 2011, NAMA has identified more than 3,800 properties as being potentially available for social housing. The local authorities and the Housing Agency are working systematically with NAMA to determine if there is a social housing demand for properties identified as potentially suitable for social housing, including the need for accommodation for those who are homeless. Where a demand is identified, this information is provided to NAMA and efforts are made to secure as many of the suitable properties as possible for social housing. It is anticipated that in the main, suitable properties will be secured through leasing arrangements with the property owners or receivers or directly with NAMA. The local authority will have the option of leasing the properties directly. Alternatively, the preferred approach may be to arrange for an approved housing body, AHB, to secure the properties through lease or, in some cases, purchase arrangements and make them available for social housing support through payment and availability agreements. An option to purchase at a future date can also form part of leasing arrangements.
As of the end of August 2012, 133 housing units had been provided from the portfolio of units identified by NAMA, of which units 49 are funded under leasing arrangements, with the balance of units delivered purchased with funds from the local authority social housing capital investment programme or by approved housing bodies under the capital assistance scheme. The 49 units funded under leasing arrangements were purchased by AHBs through a combination of State and private capital.
I thank the Minister of State for her reply. I acknowledge some good work has been done in respect of NAMA houses and houses in unfinished estates with the money used for safety purposes. However there is a problem with the houses themselves and not the infrastructure in that a promise was made that many housing units would come on-stream for social housing. If I heard the Minister of State correctly, approximately 1,400 such units have come on stream to date. The problem is that the social leasing schemes cost thousands of euro every year for each unit and this is money which goes back to the developer or investor. The other point to remember is that another cost is being cooked up with regard to long-term leases, as such units must be returned in perfect condition. In effect, this is acting as a second bailout for developers. Moreover, it is pushing up the prices of rent, which sometimes are artificially high because NAMA properties are not available for rent.
I will get to the question shortly but must first set the context. A total of 16,881 units remain empty in the unfinished estates even as 100,000 family units await housing within the State. A total of 17,070 estates have been left unfinished but 16,881 housing units remain vacant. There is a huge demand for housing at a time when all these vacant houses are available. In my constituency of Laois-Offaly, approximately 3,500 people are in need of housing and yet 657 vacant units exist there, 174 of which are in County Offaly and the other 483 in County Laois.
I thank Deputy Stanley. First, all Members share a determination to ensure that as many of these unoccupied units as possible will become occupied and will become homes for people. However, I make the point, of which the Deputy probably already is aware, that not all the unfinished houses are in NAMA. Indeed, only a relatively small proportion of them actually are in NAMA. It is a question of trying to provide for the existing need in as effective a way as possible. While I am unsure whether the Deputy actually asked the question, I will provide him with the figure. The cost of leasing is approximately €7,400 per annum whereas were one to attempt to build houses, one would get an awful lot of leasing units for the cost of building a single house. Moreover, the Government must make do and, given the times, must try to house as many people as possible by whatever method it can use. The leasing arrangement provides housing for people. I admit all Members would probably prefer to be able to build more houses but we cannot because we do not have the money. In addition, only 80% of the market rent is paid under the leasing agreements. Consequently, the entity which owns the house, be it NAMA, a receiver, a property developer or whoever, does not get the full market rent. There is a possibility of purchase although that varies depending on the different units. It is a complex issue but the Government is trying, in so far as possible, to get as many such units as possible for social housing to provide homes for people.
Everything, including bank debts, can become complex when we try to do something but we must try to make this simple. There are almost 17,000 vacant houses in unfinished estates but 100,000 people are on the waiting list. The Minister of State mentioned issues regarding the purchase of houses. Many of these houses are now for sale for less than €50,000, and there is a cost at the end of the process. That is seven years of rent.
Will the Minister of State reply to me on the idea of a rent to buy scheme? There are conditions for planning in some of these estates that relate to social housing but there could be a scheme where the tenants could rent a property and own it after a period. There could also be a super-affordable scheme, as it were. I could show the Minister of State some estates where properties cannot be sold, although she probably knows them. There are apartment blocks outside Dublin for which people cannot get loans so why are we not moving to use some of them for homeless people? We are paying millions of euro for rent allowance in a process that cannot continue as it is.
There are local authority estates that have not been completed because of inadequate funds. If a local authority has to spend €100,000 finishing an estate, should it get some units in lieu of the work when there is no money for payment? I am trying to provide solutions.
We are engaging regularly with NAMA and we push the agency all the time to ensure we get the best possible outcomes. We will put the various suggestions to NAMA. If we did not have a leasing system, there would be many more people on housing waiting lists. It is the most cost-effective way to house people in the current economic climate and we must use it. There are ongoing issues and we are working very hard on them. Some of the units coming from NAMA will be for homeless people. I will ensure that as we want to prioritise the people most in need.