Carol Nolan (Laois-Offaly, Independent)
Link to this: Individually | In context | Oireachtas source

1226. To ask the Minister for Housing, Planning, and Local Government if the introduction of the affordable housing schemes will be prioritised; and if he will make a statement on the matter. [4049/20]

Eoghan Murphy (Dublin Bay South, Fine Gael)
Link to this: Individually | In context | Oireachtas source

In line with the commitments in Rebuilding Ireland to support the delivery of discounted homes to buy or rent, the Government has allocated €310 million under the Serviced Sites Fund (SSF) over the period 2019 to 2021. This funding will provide for infrastructure to support the delivery of some 6,200 more affordable homes on local authority lands. SSF has been made available to local authorities who have demonstrated a requirement for more affordable housing and a viability to deliver such housing on their sites.

Land utilisation and activation is, in the first instance, a matter for the local authority and its elected members. This includes the development of its land for the delivery of more affordable private housing. In order to target SSF funding interventions, local authorities were invited to undertake an economic assessment of their sites to assess whether the provision of affordable homes was necessary and economically viable. As part of that assessment local authorities were also asked to consider the broader housing affordability within their area. 19 local authorities returned economic assessments to my Department.

To date, I have allocated SSF funding of €127 million, in support of 35 projects in 14 local authority areas, for infrastructure works that will facilitate the delivery of almost 3,200 more affordable homes. I anticipate that a further Call for Proposals under the SSF will issue to local authorities later this year. Details of the projects approved under the 1^stand 2^ndSSF calls are available at the following links:

Homes delivered under the SSF are subject to the provisions of Part 5 of the Housing (Miscellaneous Provisions) Act 2009, which was commenced in June 2018. This legislation now provides the statutory basis for the delivery of affordable housing for purchase in the State. Regulations in respect of the making of Schemes of Priority were signed on 12 March 2019, and these were issued to local authorities on 22 March 2019. The purpose of a Scheme of Priority is to set out the affordable purchase arrangements at local authority level. This includes the methodology that will be applied by local authorities to determine the order of priority to be accorded to eligible households where the demand for such affordable dwellings exceeds the number available.

In line with the legal requirements of the Affordable Dwelling Purchase Arrangements, further regulations will be put in place over the coming months regarding eligibility and other matters. When the operational procedures for the scheme are finalised, and before dwellings are made available for purchase under the scheme, a programme of communication will be undertaken by my Department and local authorities.

In order to be eligible for affordable dwelling purchase arrangements, a household’s income must be such that it is inadequate to meet the repayments on a mortgage for the purchase of a dwelling to meet the accommodation needs of the household, because the payments calculated over the course of a year would exceed 35% per cent of the annual income of the household (net of income tax and pay related social insurance). Eligibility is also generally limited to first time buyers. The maximum discount on market value that may be given to an eligible purchaser is 40%.

When a dwelling is made available to a purchaser under an affordable dwelling purchase arrangement a charging order is made by the housing authority. This places a charge on the dwelling with an amount equal to the difference between the purchase money and the market value of the dwelling. Payments may be made by the purchaser to reduce this amount during the charged period. The amount outstanding on the charge must be repaid in full at the end of the charged period.

The selling price of discounted dwellings made available for purchase by a housing authority under the affordable dwelling purchase arrangements will be influenced by a number of factors, particularly the overall development costs of the homes (taking into account subvention inputs such as the local authority land value and Serviced Sites Fund), which can vary significantly from one site to another, the tenure mix involved and the local housing market.

In addition to the SSF, funding of €200m has also been made available under the Local Infrastructure Housing Activation Fund (LIHAF), which is designed to activate housing supply by putting in place the enabling public infrastructure necessary to ensure that large scale development could take place on key sites in urban areas of high housing demand. 30 projects received final approval, at a total cost of €195.71 million, of which €146.69 million will be funded by the Exchequer, with local authorities funding the balance. These projects will stimulate development of up to 20,000 homes across 14 local authorities and local authorities have indicated that approximately 40% of the homes delivered will be offered at a discount on open market prices.

Details of the projects approved under LIHAF are available on the Rebuilding Ireland website at the following link:

The Land Development Agency also has a role in the delivery of more affordable housing and a minimum of 30% of housing on LDA sites must be affordable, with the balance contributing to additional new supply to meet the high levels of demand in the wider housing sector. This is consistent with a Government Decision in September 2018 that any State lands, in Ministerial ownership and deemed suitable for housing, being sold on the open market must deliver affordable housing on at least 30% of the site.

The provision of a discount on market values will mean that homes will be available to very many individuals and families on more moderate incomes who would otherwise not be in a position to own their home.

These schemes will complement other key Government affordability initiatives, such as the Rebuilding Ireland Home Loan, and the Help to Buy Scheme, which latest figures indicate have supported over 20,000 households nationally.