Written answers

Tuesday, 31 January 2012

Department of Environment, Community and Local Government

Local Authority Housing

9:00 pm

Photo of Robert TroyRobert Troy (Longford-Westmeath, Fianna Fail)
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Question 461: To ask the Minister for the Environment, Community and Local Government the criteria he requires for tenants to purchase their local authority houses; and if he will make a statement on the matter. [5456/12]

Photo of Jan O'SullivanJan O'Sullivan (Limerick City, Labour)
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There are two current schemes for tenants of housing authorities to purchase their homes. The first, the tenant purchase scheme, is provided for in section 90 of the Housing Act, 1966. The second, the incremental purchase scheme in respect of newly-built homes designated by housing authorities for incremental purchase, is provided for under Part 3 of the Housing (Miscellaneous Provisions) Act, 2009. The details of the schemes are set out in the legislation and in the associated regulations.

The criteria for a tenant purchasing a home under the tenant purchase scheme include that a tenant must have a period of reckonable tenancy of at least one year's duration. In the case of the 2011 Fixed Term Tenant Purchase Scheme for long-standing tenants, for which applications are now closed, a ten year tenancy period applied. The Housing Miscellaneous Provisions Act, 1997 provides that a housing authority may refuse to sell a dwelling to a tenant where the authority considers that the tenant is or has been engaged in anti-social behaviour or that a sale to that tenant would not be in the interest of good estate management. Certain classes of houses, as distinct from tenants, may be excluded from sale under the Regulations and in accordance with the provisions of individual tenant purchase schemes adopted by housing authorities.

Incremental purchase is available in respect of designated houses to eligible existing and prospective tenants. Under the incremental purchase scheme, there is no minimum tenancy period required. However the following criteria are considered -

- minimum income requirements set out in the regulations

- the household's history of house purchase

- rent arrears

- anti-social behaviour provisions set out in the 1997 Act mentioned above.

In addition to the above schemes, there is a separate scheme for the purchase of apartments in respect of which different conditions apply.

Photo of Robert TroyRobert Troy (Longford-Westmeath, Fianna Fail)
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Question 462: To ask the Minister for the Environment, Community and Local Government if he will ensure that local authority tenants who are in receipt of social welfare are not automatically disqualified from applying to purchase their homes. [5457/12]

Photo of Jan O'SullivanJan O'Sullivan (Limerick City, Labour)
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Provisions governing mortgage lending by local authorities are set out under the Housing (Local Authority Loans) Regulations 2009 and associated credit policy. To ensure effective targeting of resources, loan finance continues to be available to first time buyers only. Income limits are also in place, distinguishing between single and dual income households and a maximum loan limit is applied. In assessing loan applications local authorities take account of the household's ability to finance the loan based on their net household income. While, as a general rule, the credit policy provides that loans are not available to those in receipt of unemployment/social welfare benefits, an exception may be made where there is a primary income of a permanent waged/salaried nature, and where the secondary income is from the Department of Social Protection.

In such cases long term social welfare payments can be considered, provided the long term nature of the payment is confirmed. The final decision on whether to grant/refuse an applicant lies solely with the relevant local authority. All local authorities must satisfy themselves on the financial risk they are undertaking.

The relevance of the difference between projected mortgage repayments and current rental payments for a prospective purchaser is limited. It takes no account, for example, of the fact that while rent levels can be adjusted to reflect changing household income, mortgage repayments cannot. Nor does it take account of the additional costs taken on when a household becomes a homeowner thereby assuming responsibility for the ongoing maintenance of their home. These provisions apply for purposes of mortgage lending by all local authorities.

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