Jack Wall (Kildare South, Labour)
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Question 130: To ask the Minister for the Environment, Community and Local Government if an actuarial assessment has been or is proposed to be carried out in relation to the 4.5% annual increase on the loan, known as rent section, aspect of the shared ownership scheme held by each local authority, as to the effect of this increase in regard to the value of the scheme and to the overall total cost of the loan to the applicant; if not, if he will have such an evaluation completed to determine if the scheme is a benefit to such applicants; and if he will make a statement on the matter. [33845/11]

Willie Penrose (Longford-Westmeath, Labour)
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The Government's housing policy statement announced the standing down of all affordable housing schemes, including the shared ownership scheme, in the context of a full review of Part V of the Planning and Development Act 2000. The detailed workings of this review have not been determined to date, however, it is likely that it will include detailed analysis of the rental portion of the shared ownership scheme. While it is open to local authorities to enter into new shared ownership loans if applicants apply for this scheme, as the legislation is still in place, it is recommended that both parties fully inform themselves of the details of the scheme.

The rent charged on the local authority's equity in a shared ownership transaction is to cover the funding costs to the Housing Finance Agency which are based on borrowings at the prevailing interest rates. Any difference between the rent and prevailing interest rate is reflected in the capital outstanding on the property i.e. if the rent charged in any period is greater than the prevailing mortgage interest due on the local authority's share, the purchase price of the outstanding equity will be reduced accordingly.

In addition, an annual subsidy towards rent payments under the Shared Ownership Scheme is available, through the Rental Subsidy Scheme, to households with a gross household income of up to €28,000 per annum in the preceding tax year. The level of subsidy ranges between €2,550 for incomes up to €13,000 and €1,050 for incomes up to €28,000.