Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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586. To ask the Minister for Housing, Planning, and Local Government the approved housing bodies involved in the mortgage-to-rent initiative; the banks that are involved in the initiative; the way households are identified as suitable for inclusion in the initiative; the number of households nationally that are provided for by this scheme; the terms for tenants; the duration of the lease; the provisions for tenants to purchase back the property; the parameters by which tenants can remain in the home beyond the term of the lease; the provisions made for families of the chief earner in the event of their death or serious illness; the person that is financially responsible for the upkeep of the property; and if he will make a statement on the matter. [30769/21]

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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The Mortgage to Rent (MTR) scheme introduced in 2012 is targeted at supporting households in mortgage arrears who have had their mortgage position deemed unsustainable by their lender under the Mortgage Arrears Resolution Process (MARP); agree to the voluntary surrender of their home and are deemed eligible for social housing support. The property in question must also meet certain eligibility criteria.

To the end of March 2021, 1179 households with unsustainable private mortgages have completed the MTR scheme since its introduction nationally in 2013. The 1179 households in the scheme represent 1970 adults and 1699 children who have remained living in their homes and communities. There are currently 1079 active cases being progressed under the scheme.

At present there are 12 Approved Housing Bodies (AHBs), 1 private company and 23 lenders participating in the MTR scheme. The Housing Agency publishes a full range of statistics on the MTR scheme including a status report by lender and by purchaser and is available at the following link: www.housingagency.ie/housing-information/mortgage-rent-statistics

The scheme relies on the lender making the scheme available to the borrower where the lender has deemed their mortgage to be unsustainable under the MARP process and has assessed the borrower as being eligible for the MTR scheme. Under the MTR scheme, a household with mortgage arrears goes from being a homeowner to becoming a social housing tenant of an AHB or where Home for Life buys the property a social housing tenant of a local authority. The tenants pay a differential rent based on their income that is designed to be affordable and which is subject to periodic review. Where a change of circumstances in an individual household occurs, the rent level will be reviewed.

A review of the MTR scheme in 2017 taking account of capacity within the AHB sector given that sector's role in delivering ambitious targets around new social housing supply, also recommended that alternative funding options, including the off-balance sheet potential of private institutional investment, be explored in order to allow the MTR scheme to deliver at scale. An Expressions of Interest (EOI) Request issued in 2017 inviting parties from the private sector to express their interest in participating in a new alternatively funded long-term MTR lease model. The outcome from the EOI process is that a new MTR alternatively funded lease model was announced in 2018 with Home for Life Ltd. as the participant from the private sector.

Under this alternatively funded model, Home for Life purchases properties from lenders subsequent to their voluntary surrender by borrowers that meet the MTR eligibility criteria and then enters into a long-term 25 year lease arrangement with the local authority in whose area the property is situated for a defined term at an agreed rent, thereby enabling the borrower to remain living in their own home under a tenancy agreement with the local authority. Home for Life is also responsible for managing and maintaining the property on behalf of the local authority in accordance with the lease requirements.

The provision to allow the borrower to buyback the property has been a feature of the MTR scheme since its inception. A borrower has the option of buying back the property after 5 years or at the discretion of the property owner before the 5 years has expired. Where an AHB or Home for Life buys the property from the lender at a non-discounted price, the borrower has the option of buying back the property at the open market value on the date of the buyback but the property cannot cost less than what the property owner paid for it. Alternatively, where the property was purchased from the lender at a discounted price, the borrower may opt to buy back the property at the price the property owner paid for it plus all costs incurred by the property owner on the property including repairs, cost of finance and legal costs. A clawback will also apply to this option where the borrower sells the property within 20 years of buying back the property. To date, there had been only 1 case where a borrower has bought back their home.

Regardless of who the property owner is under the MTR scheme, AHB or Home for Life, the local authority is obliged to meet the housing needs of social housing tenants indefinitely and beyond the term of the applicable lease arrangement.

AHBs are an integral part of the MTR scheme and their participation in the scheme has enabled and continues to enable a significant number of borrowers to remain in their homes as social housing tenants. AHBs, as landlords, are responsible for managing and maintaining the properties they acquire under the MTR scheme.

The inclusion of an MTR provider from the private sector has facilitated more individuals and families staying in their homes. Given the sizeable cohort of borrowers still in long-term mortgage arrears, all the MTR providers participating in the scheme are needed in order to meet the demand for the scheme. In all scenarios, my Department and the Housing Agency are focused on meeting the long-term housing needs of the greatest number of households in unsustainable mortgage arrears.

The Programme for Government includes a commitment to strengthen the Mortgage to Rent Scheme and ensure that it is helping those who need it. Building on the significant improvements already made to the scheme since 2017, my Department is currently working closely with the Housing Agency and key stakeholders to identify any further improvements required to the scheme.