Written answers

Tuesday, 27 July 2021

Department of Housing, Planning, and Local Government

Housing Schemes

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

768. To ask the Minister for Housing, Planning, and Local Government the income threshold set by him for the first cost of rental properties; the way in which he plans to set income thresholds in different local authority areas; when these will be announced; if a person’s existing housing need will be a factor determining eligibility; and if he will make a statement on the matter. [41108/21]

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

769. To ask the Minister for Housing, Planning, and Local Government if the sub-market charge to be made under individual cost rental projects will be determined according to an agreed methodology; the person or body by which this will be conducted in each case; and if he will make a statement on the matter. [41109/21]

Photo of Darragh O'BrienDarragh O'Brien (Dublin Fingal, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 768 and 769 together.

Cost Rental housing, in which the rent is set to cover the cost of provision of homes, is an entirely new housing sector in Ireland. It is not intended to overlap with or replace existing social housing supports for low-income households, which remain a parallel priority for the Government. Cost Rental is rather intended to support households with moderate income, above the limits for social housing eligibility. 

The Affordable Housing Act 2021, which was signed into law on 21 July, provides in Section 31 that the Minister may use Regulations to prescribe, among other things, "eligibility requirements in respect of tenants". This will be be necessary to ensure that Cost Rental homes, of which there will finite stock in the initial delivery phase, are accessible to the intended target cohort. The use of Regulations will allow the eligibility criteria to be set in flexible way, open to revision and updating over time.

It will be the role of the Cost Rental landlord to implement any prescribed eligibility criteria for tenants and their households, which will mean checking that tenants are eligible before they are offered tenancy contracts. In the case of the very first Cost Rental homes, the 25 houses at Balbriggan, Fingal launched on 7 July 2021, the landlord will be Clúid Housing, which is an Approved Housing Body supported by my Department's new Cost Rental Equity Loan scheme. Clúid has advertised a household net income limit of €53,000 for these homes, in advance of the enactment of the Affordable Housing Act and the making of consequent Regulations, in order to ensure that tenants can apply in good time and be accommodated in these new homes as soon as possible.

In advance of advertisement, Clúid and my Department together with the Housing Agency, had engaged extensively to ensure that these homes are let to the target cohort of moderate-income households above the social housing eligibility thresholds. The intention is that these homes will be brought under the statutory framework for Cost Rental, now that the Affordable Housing Act has been signed into law.

The full framework of Regulations that will govern this new housing sector will be prepared and introduced over the coming weeks. These will include setting an income limit for the Cost Rental sector as a whole, which will naturally be informed by the experience of Clúid Housing in letting the very first Cost Rental homes at Balbriggan. While there is potential for income limits to vary from region to region and this may be addressed in the future, the initial focus is on making an entirely new form of housing as easy as possible to understand and deliver. Aside from the identified affordability constraint, it is not envisaged that "existing housing need" will be a factor in the same sense that it is for social housing, since Cost Rental is intended to be a fundamentally different housing tenure targeting a different cohort. However, as per the legislation, it is intended that Cost Rental landlords will have regard to the size and composition of a household when considering it for a particular Cost Rental home.

In relation to the "sub-market charge to be made under individual cost rental projects", I assume the Deputy is referring to the cost rents that will be charged for each home. As per Part 3 of the Affordable Housing Act, the initial maximum rent for each home to be designated as a Cost Rental dwelling will be set and agreed during the application process for designation. This is a result of modelling the costs of provision, financing, maintaining and managing the home over a 40-year period, and is not linked to the open market rent for the home. The detail of the designation process will be set out further in regulations, but the Cost Rental designation itself will be formally issued by me, as Minister. 

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

770. To ask the Minister for Housing, Planning, and Local Government when he will issue a new directive in respect of the revised subsidy that his Department will grant to support the delivery of affordable homes in rent pressure zones under the site support scheme; and if he will make a statement on the matter. [41110/21]

Photo of Darragh O'BrienDarragh O'Brien (Dublin Fingal, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

Contained within the Programme for Government was a commitment to extend the Serviced Sites Fund (SSF). In line with this commitment, a review of the SSF progress and projects to date was undertaken and, having regard to feedback from local authorities, a number of significant improvements to the funding scheme, now named the Affordable Housing Funding scheme, have been agreed and communicated to local authorities by way of Circular last month. 

The changes include expanding the scope of costs covered to subvent the all-in development cost of delivering the housing, which may include land purchase costs; taking applications as they are developed on a rolling basis as opposed to time constrained funding calls; and, allowing funding support to now exceed the current maximum of €50,000 per affordable dwelling on a stepped scale to €100,000, based on location and density.

The improved and expanded funding scheme will provide key, enhanced support to local authorities in making available new dwelling units for purchase or rent at affordable prices. 

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

771. To ask the Minister for Housing, Planning, and Local Government when he plans to publish regulations that would permit a local authority to draw up a scheme for the allocation of affordable homes; if the same scheme will apply to affordable homes acquired from a Part V quota, an LDA project or a development of affordable homes on the council’s own lands; and if he will make a statement on the matter. [41111/21]

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

772. To ask the Minister for Housing, Planning, and Local Government if affordable homes built with the help of the grant from his Department or an acquisition by the LDA of sites at values consistent with affordable pricing will all be sold at a uniform price to all successful applicants; if successful applicants with a lower capacity to finance a mortgage can in addition avail of the shared equity scheme; and if he will make a statement on the matter. [41112/21]

Photo of Darragh O'BrienDarragh O'Brien (Dublin Fingal, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 771 and 772 together.

The Affordable Housing Act 2021 was enacted by the President on 21 July 2021. This Act is the first ever standalone affordable housing legislation, establishing a basis for four new affordable housing measures. These measures will deliver on the Programme for Government commitment to put affordability at the heart of the housing system and prioritise the increased supply of affordable homes through (1) delivering affordable homes on local authority lands, (2) the introduction of a new form of tenure in Cost Rental, (3) a new affordable purchase shared equity scheme and (4) expanding Part V planning requirements to increase the 10% contribution requirement to 20% and to apply it to cost rental as well as social and affordable housing.

It is my intention to commence the provisions of the Affordable Housing Act in the near future. In this regard, the required regulations to implement these measures including eligibility etc. are being progressed on a phased basis by my Department officials and will be finalised over the coming weeks.

In this regard, I can confirm, that in respect of Part 2 of the Act and the sale of affordable homes, it is envisaged that direct sales agreements will specify the purchase price at which the dwellings can be made available to eligible purchasers. This may vary in accordance with individual affordability i.e. the borrowing capacity/purchasing power of the individual eligible purchasers, which is related to incomes.

The minimum price for which a dwelling may be sold will be determined by the local authority and would be influenced by development costs including supports such as the Affordable Housing Fund (which replaces the Serviced Sites Fund).

Local authorities will take an equity stake in the home equivalent to the “affordable dwelling contribution”. This is essentially the discount from market value and the percentage that discount represents of market value will be the percentage equity share the local authority takes in the dwelling. The amount of the contribution will be the amount needed to bridge the gap between what the applicant can borrow under the macro-prudential rules and the market value of the home (subject to the proviso that there will be a minimum price below which the housing authority cannot sell the unit).

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

773. To ask the Minister for Housing, Planning, and Local Government when it is proposed that he will set the affordable price in respect of sites being identified by the LDA for potential designation by Government as sites for early development to fulfil housing needs in areas of housing pressure; and the prices which have been set to date on sites in advanced planning or delivery. [41113/21]

Photo of Peter BurkePeter Burke (Longford-Westmeath, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Land Development Agency (LDA) was established on an interim basis in September 2018, by way of an Establishment Order made under the Local Government Services (Corporate Bodies) Act 1971. The Land Development Agency Act 2021 was recently signed into law and, on enactment, the LDA will be established as a commercial State agency.

Under Part 9 of the LDA Act any affordable housing delivered on relevant public lands, either by the LDA or another developer for purchase or cost rental, will be provided fully in accordance with the provisions of Part 2 (Affordable Dwelling Purchase Arrangements) and Part 3 (Cost Rental Dwellings) of the Affordable Housing Act. This will also ensure that if any provisions in the Affordable Housing Act, including its regulations, change in the future, they will automatically apply to a developer of relevant public lands (including the LDA) under an LDA Act Part 9 affordable housing delivery agreement.

There are 3 options under Part 9 of the LDA Act for a developer, including the LDA, to deliver affordable housing on relevant public lands in accordaance with the Affordable Housing Act: the housing can be designated and leased as cost rental under Part 3 of that Act; the housing can be transferred on completion to a planning authority under Part 2 of that Act; or the housing can be transferred on completion to the ownership of relevant applicants as nominated by the local authority under a direct sales agreement under Part 2 of that Act.

It should be noted that while the LDA is required to pay market value for the purchase of public land, there will a minimum 50% affordable housing delivery requirement for relevant public lands under Part 9 of the LDA Act, with a minimum of 80% affordable housing on relevant public lands in urban areas with a population greater than 150,000, that is Dublin and Cork cities. This will be in addition to the increased 20% Part V social and affordable housing obligation being introduced under the Affordable Housing Act which will ensure that there will be 100% affordable and social housing on such lands in our largest cities. As such, the market value of such public lands will be significantly reduced in terms of the purchase price that the LDA will pay.

The LDA is currently engaging in pre-construction activity on a number of public sites but has not yet taken ownership of any sites. After commencement of the LDA Act, it is intended that the Valuation Office will individually value public sites that the LDA has decided to purchase taking into account the minimum 50% or 80% affordability requirement (as appropriate) under Part 9 of the LDA Act and the increased 20% Part V social and affordable housing obligation.

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

774. To ask the Minister for Housing, Planning, and Local Government when it is planned that the Land Development Agency will present to the Government its first report on additional public land fit for use for housing beyond those already planned for development; and if he has engaged with the authority in respect of the scale of the ambition in that initial report in terms of additional capacity for housing units. [41114/21]

Photo of Peter BurkePeter Burke (Longford-Westmeath, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Land Development Agency (LDA) was established on an interim basis in September 2018, by way of an Establishment Order made under the Local Government Services (Corporate Bodies) Act 1971. The Land Development Agency Act 2021 was recently signed into law and, on enactment, the LDA will be established as a commercial State agency.

Under Section 52 of the Land Development Agency Act 2021, the LDA shall furnish a report to Government every 2 years detailing how public lands are being utilised and identifying any lands which may be appropriate for the LDAs objectives. On receipt of such a report, the Government can direct a relevant public body to dispose of its land to the LDA. The first report to be provided by the LDA to Government is required to be submitted within 12 months of the coming into operation of Section 52, which is expected to be commenced in Autumn 2021.

There is ongoing engagement between the LDA and my Department in relation to the identification of relevant public lands suitable for the delivery of substantial additional housing in locations with a significant housing need.

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

775. To ask the Minister for Housing, Planning, and Local Government if he is in a position to indicate the exact terms of the memorandum of agreement and regulations which shall govern the shared equity scheme in terms of classes of dwelling, security, conditions for redemption, rate of interest and so on; and if he will make a statement on the matter. [41115/21]

Photo of Darragh O'BrienDarragh O'Brien (Dublin Fingal, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The Affordable Housing Act 2021, which cleared all stages in the Oireachtas on the 12thJuly and which was signed in to law by the President on the 21stof July, is the State's first ever standalone affordable housing legislation. The provisions of the Act establish the basis for four affordable housing measures. These measures will deliver on the Programme for Government commitment to put affordability at the heart of the housing system, and prioritise the increased supply of affordable homes, through (1) delivering affordable homes on local authority lands, (2) the introduction of a new form of tenure in Cost Rental, (3) a new affordable purchase shared equity scheme, and (4) expanding Part V planning requirements to increase the 10% contribution requirement to 20% and to apply it to cost rental as well as social and affordable housing.

Specifically in relation to Part 4 of the Act and the development of a new affordable purchase shared equity scheme, I can confirm that my officials are engaging with a range of stakeholders to finalise the administrative and operational provisions of the scheme. Scheme details, including the broad terms included in any Memorandum of Agreement and the deployment date of the scheme, will be confirmed as part of this process.

Comments

No comments

Log in or join to post a public comment.