John Deasy (Waterford, Fine Gael)
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Question 385: To ask the Minister for the Environment, Heritage and Local Government if the prices of affordable housing are currently reflecting the downturn in the housing market; if local authorities who negotiated the cost prior to the downturn are committed to that price; and if he will make a statement on the matter. [9674/09]

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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The price of affordable housing units transferred to local authorities under Part V primarily reflects the costs negotiated, in accordance with the relevant legislation, between authorities and developers. These costs are based on the sum of the site costs, calculated at existing use value, actual construction costs as agreed between the local authority and the developer, plus reasonable profit on those costs.

Where authorities consider it appropriate, in the context of reduced open market prices and the continuing need to ensure value for money outcomes, they have the option to further reduce the sale price by further subsidisation, including the use of any Part V funds on hands. Local authorities are best positioned to make judgments in this regard based on local circumstances. Local authorities may also consider the scope to re-negotiate Part V agreements, having regard to the nature of contracts entered into by them with developers.