Paul Murphy (Dublin South West, RISE)
Link to this: Individually | In context | Oireachtas source

535. To ask the Minister for Finance the reason that a property must never have been used or have been suitable for use as a residential home in relation to the help-to-buy scheme (details supplied); and if similar support is available to those who are purchasing a property that has previously been used as a residential home. [21266/22]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Help to Buy (HTB) is a scheme to assist first-time purchasers with the deposit they need to buy or build a new house or apartment. The incentive offers a refund on Income Tax and Deposit Interest Retention Tax (DIRT) paid in the State over the previous four years, subject to limits outlined in Section 477C of the Taxes Consolidation Act 1997.

For a property to qualify for HTB, it must be new or converted for use as a dwelling, having not been previously been used as a dwelling. In the circumstances where the house was previously used as a dwelling but knocked down and rebuilt, then it is considered “new”. First-time buyers may purchase a site containing a house which is derelict and which they plan to demolish, in whole or in part, with the intention of building a new house. First time buyers intending to undertake such purchases should contact Revenue via MyEnquiries outlining the specific circumstances of their case and Revenue will consider them on a case by case basis.

In relation to the specific question about properties previously used as a residential home, the HTB scheme is designed to encourage an increase in demand for new build homes in order to encourage the construction of an additional supply of such properties. An increase in the supply of new housing is fundamental to resolving the current housing crisis and so remains a priority aim of Government policy. A move to include properties previously used as a residential home/second-hand properties within the scope of the relief would not improve its effectiveness; on the contrary, it could serve to dilute the incentive effect of the measure in terms of encouraging additional supply.

With regard to the Deputy's question as to whether similar support is available to those first-time buyers who purchase a second-hand property, there is no a similar tax-based measure.  Such a scheme would be likely to have a significant deadweight element and a high Exchequer cost while providing no incentive effect for encouraging the building of new homes.

Non tax-based supports are, primarily, a matter for the Minister for Housing , Local Government and Heritage.

Finally, and as the Deputy may be aware, I announced in my Budget 2022 address that a formal review of HTB will take place in 2022. The review will inform decisions for Budget 2023 and Finance Bill 2022. My Department is currently managing the tender process and I understand that a contract for the review exercise is likely to be awarded shortly.