Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

I understand the frustration. Senators referred to viability. I am not the one who determines that because viability is essentially determined by the marketplace. If houses are being built, there is viability. If they are not being built - and regardless of how we define viability - there is a problem. That is how matters have stood for quite some time. For those Members who were not here earlier, I repeat that 12,500 houses were completed last year, some 6,000 of which were one-off houses in the countryside. Of the other 6,500, almost half related to unfinished housing estates and apartment blocks being finished. Only 3,000 to 4,000 new houses were completed last year throughout the entire country. Three quarters of the way through the year, there were just 15 applications to An Bord Pleanála for planning permissions for developments of more than 100 units. This was despite the fact that there is a need to build approximately 30,000 units per year. We are at about one tenth of the way towards where we need to be.

There are many indications that things are being ramped up and activity is commencing. I am delighted that people are now talking about building large numbers of starter homes on the outskirts of Dublin for first-time buyers that will cost between €200,000 and €300,000 each. It is the first time in a decade we have heard that kind of talk. What I am trying to do now is ensure that we continue to swim with the tide as it starts to move in the right direction, as opposed to putting obstacles in the way of getting outcomes. Essentially, this means building new houses in the right locations at the right price and of the right quality.

Nothing irritates me more than people sitting on sites for the purposes of speculation, which is purely about a profit grab, increasing margins by forcing everybody to wait and allowing more pressure to build up in the property market to drive prices up further. That said, however, we have had many conversations with local authorities, developers and stakeholders in this sector who refer to genuine obstacles to being able to build and open up sites. That is why we are committing €200 million to an infrastructure fund - most of which will be spent in Dublin and the greater Dublin area - in order to get viability on these sites by having the State take some of the infrastructure cost relating to opening them up. We know there are some viable sites that should be up and running soon. These are not owned by builders but by speculators. They are owned by funds that are buying them because they know we have a pressurised market which is becoming more pressurised by the month. Prices are going up and they are looking to buy, to speculate, to sell and to make a profit. If possible, we need to get those entities out of the sector and the industry.

There are also people who have been through bankruptcy and who are now setting up new construction and development companies, and trying to come back into the market and raise finance for projects. Some of them have sites and some do not. Some of those sites are more financially attractive than others in terms of getting the finance to be able to move ahead. Most of these projects need financial backers from outside their own companies, whether that is through the conventional banking system, equity funds or other types of funding partnerships. What funders will look at is financial returns in terms of the ability to be able to sell houses to pay for the funding of projects. These are the realities that people do not like talking about but they are still the realities.

My job is to ensure that we get affordable houses built at reasonable prices and that people are not speculating and hoarding land. Undoubtedly, some hoarding is taking place in Dublin. I look forward to introducing a vacant site levy so that people who are sitting on sites and doing nothing with them will have to pay a levy linked to the value of those sites. Before Report Stage on Tuesday, I will look at how we can incentivise and encourage people to move on to building when they get planning permission, sooner rather than later, with both a carrot and a stick. However, there are dangers to linking it to the potential viability or potential funding capacity on a separate site they may own. That is all I am saying. We are all trying to achieve the same thing here, which is to get zoned sites moving. If we look at the increased activity that is happening, what we want to do is encourage and accelerate that rather than put obstacles in its way.

My judgment on this, for what it is worth, is that we will end up with an unintended consequence from an amendment that has been tabled for all the right reasons. I need to caution against that. I am happy to have a discussion on this again in a few days but, as it is proposed at present, I think there are probably more problems than solutions attaching to the amendment.