Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Question 312: To ask the Minister for the Environment, Heritage and Local Government the guidelines under which local authorities operate when revaluing shared ownership homes on an annual basis to determine the purchasers' rental rate; and his views on the lack of transparency in the process. [32011/09]

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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Under the shared ownership scheme houses are acquired by a local authority and leased to the shared owner, who purchases at least 40% of the value of the house and rents the remaining equity from the local authority. The shared owner must purchase full ownership outright within 30 years.

For transactions commenced on or after 1 January 2003, the annual rent is calculated at 4.3% of the value of the local authority equity and, thereafter, is increased by a fixed 4.5% on 1 July each year. The rent is used to repay the interest element of the borrowings on the local authority's equity. Any excess or shortfall in rent collected, using this formula in comparison to using the prevailing interest rates, is offset against the outstanding equity each year.

For transactions entered into between 1 May 1998 up to 31 December 2002, rent is calculated at 41⁄2% (5% before 1 May 1998) of the value of the local authority share updated annually on the 1 July by reference to the most recently published CPI.

Local authorities advise all potential applicants on the operation of the scheme including the calculation of the rental element and I am satisfied that it operates in an open and transparent manner.