Catherine Connolly (Galway West, Independent)
Link to this: Individually | In context | Oireachtas source

128. To ask the Minister for Finance further to Parliamentary Question No. 121 of 24 January 2023, his plans for the phasing out of the help-to-buy scheme; the timeline for same; the details of any analysis carried out by his Department into the impact of the scheme on the price of new houses in 2022; and if he will make a statement on the matter. [11106/23]

Michael McGrath (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

As indicated in my predecessor's Budget 2023 address to the House on 27 September 2022, the Help to Buy scheme has been a significant support for first time buyers of new homes. Since its inception in 2017 and to 31 January 2024, some 37,500 first-time buyers, either singly or as part of a couple, have benefited from the scheme.

To reiterate the response to Parliamentary Question No. 121 of 24 January 2023, it remains the case that, as with any tax expenditure, the scheme will be kept under review. In the meantime, however, the Government has decided to continue the scheme, at current rates, until the end of 2024 and this has been legislated for in the Finance Act 2022. The future of the measure beyond end-2024 will be considered in due course.

A comprehensive review of the Help to Buy scheme carried out by external consultants, Mazars, was completed July 2022. A recommendation arising from the review was that the scheme be extended in its form for two further years. The decision to extend the scheme until the end of 2024 aligns with this recommendation.

The Mazars report also indicated there was not sufficient data available to indicate that the scheme, of itself, was having a significant inflationary effect within our property market. The scheme is confined to first-time purchases and to new supply, including self-build homes. For that reason, the total number of transactions that benefit from the Help to Buy scheme is a minority of the overall transactions of homes that take place in our State each year. For those reasons, I agree with Mazars that there isn't definitive evidence that Help to Buy pushed up the price of new houses.

The report can be found at the following link:

assets.gov.ie/235748/3b8ca22f-969c-40ab-a278-08583d533b48.pdf