Written answers

Wednesday, 25 November 2015

Department of Finance

NAMA Social Housing Provision

Photo of Michael CreedMichael Creed (Cork North West, Fine Gael)
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80. To ask the Minister for Finance if he has issued a communication to the National Asset Management Agency regarding its portfolio and the requirement that it would significantly contribute to a resolution of the social housing crisis; and if he will make a statement on the matter. [42047/15]

Photo of Michael NoonanMichael Noonan (Minister, Department of Finance; Limerick City, Fine Gael)
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I and my officials engage regularly with NAMA on issues such as social housing and residential supply more generally to benefit from their understanding and activity in the market; to better understand how their activity may have an impact on the market and to challenge them to evaluate opportunities in line with their objectives that may make a difference in the market. 

However, I have not issued any formal direction regarding NAMA's activities in housing as decisions related to NAMA's portfolio are, ultimately, a commercial consideration for the NAMA Board in the context of the Agency's independent mandate to obtain maximum return to the State.

In this regard and completely in line with their objectives, NAMA has made, and is making, a very substantial contribution to the supply of properties for social housing.

Under an initiative agreed between NAMA and the then Minister for the Environment, Community and Local Government in 2012, NAMA has made over 6,500 residential properties available for social housing.  This represents the entirety of vacant residential property within NAMA's portfolio that was available and potentially suitable for social housing. There is extensive detail on this initiative on NAMA's website, .  Under this initiative, NAMA identified the properties to the Housing Agency under a Non-Disclosure Agreement (NDA) which in turn has engaged with local authorities to ascertain demand and with local authorities and approved bodies to determine the allocation of properties for which demand was confirmed.  NAMA has no role in determining which properties or the number of properties that are required for social housing or in decisions relating to the location or allocation of properties by the Housing Agency. 

Of the 6,500 properties made available by NAMA, demand has been confirmed by local authorities for just over 2,500 and more than 1,600 of these have already been delivered.  The 4,000 residential properties not taken up for social housing have been either sold or rented in the private housing market by NAMA debtors and receivers and in that way have contributed to increased market supply.  In determining demand, local authorities based their decisions on criteria such as location and wider planning and housing policy considerations.  There were also cases where the related properties were sold or rented by their owners or appointed receivers in the time taken by local authorities to assess and confirm demand.

Where demand is confirmed for a property, NAMA makes whatever funding is needed, more than €50m to date, to ensure that  previously unfinished properties are completed and comply fully with all building standards.  In addition to facilitating the sale or lease of properties through its debtors and receivers, NAMA has established a social housing SPV, NARPS, which directly leases properties to approved housing bodies.  NAMA has developed standardised long-term leasing arrangements and attractive lease terms to facilitate this process.

I am advised that there has been extensive engagement between NAMA and the Department of the Environment, Community and Local Government and all the other stakeholders, including the Housing Agency, local authorities and approved housing bodies, on this initiative and all of the parties have worked extremely hard to ensure that properties for which demand has been confirmed are delivered as quickly as possible, notwithstanding the substantial construction and wider compliance work that is required in many cases. 

As the NAMA Chair recently pointed out to the Public Accounts Committee, following this initiative, there are now very few unoccupied houses across NAMA's entire portfolio.

The issue of social housing is, as the Deputy is aware, directly impacted by the level of housing output generally in the economy.  NAMA is, in this respect, making a very substantial contribution to increased housing supply.  It funded close to 50% of new housing output in Dublin last year despite having an exposure to less than one-third of all Dublin residential development land.  The NAMA Board has also indicated that it could fund up to 20,000 additional new homes on a commercial basis in the five years to end-2020, approximately 90% of which could be in Dublin and the greater Dublin area where demand is greatest.  NAMA-funded residential developments are subject to the same planning and social housing provisions, including Part V of the Planning and Development Act 2000 (as amended), as all other residential development projects in the State. Therefore, NAMA's major contribution over the coming years will be in funding vitally needed new residential supply and will contribute to future delivery of social housing through Part V of the Planning and Development Act 2000 (as amended) as part of this funding.

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