Minister Darragh O’Brien says he welcomes today’s Cabinet approval for the publication of the Affordable Housing Bill 2021.
The Minister has pledged the Bill will help deliver ‘up to 6,000 affordable homes on State lands within four years.’
He also said there are four key elements of the Bill:
- The first scheme of direct state built affordable homes in over a decade
- The first ever national scheme to provide for the delivery of Cost Rental housing
- A new Affordable Purchase Shared Equity scheme for homes in private developments
- Provision for the extension of Part V to a set 20% in every Local Authority area with a 10% minimum requirement for social homes and a further 10% requirement for affordable homes where required
“This Bill is delivering on the Programme for Government commitment to put affordability at the heart of the housing system and to prioritise the increased supply of affordable homes,” Minister O Brien said.
“For the first time in over a decade we will be empowering local authorities to deliver affordable homes for purchase on their own lands, meaning that middle income earners can be supported to own their own home.
“The new Affordable Purchase Shared Equity scheme will involve the State supporting hard pressed first time buyers to purchase homes in private developments.
“This will take the form of an equity stake of up to 20% in new build homes. Eligible homes will be subject to regional price caps. The scheme will ensure that people paying high rents can instead use their hard earned income to pay down a mortgage and own their own home much sooner. Controls will be in place to prevent any inflationary effect.
Some aspects of the Bill, including its shared equity scheme for first-time buyers, have been criticised by many opposition TDs.
Solidarity TD Mick Barry said this morning that the Bill ‘will not deliver genuinely affordable housing for people on low or average incomes.’
The Bill provides for a shared equity scheme whereby the State can take a 30% stake in a property when the buyer cannot afford a full mortgage.
The scheme has been heavily criticised with the Central Bank saying it could leave mortgage holders with “excessive indebtedness” and with senior civil servant Robert Watt saying that the construction industry had been lobbying for the scheme “because it would increase prices”.
“There is a crying need for a genuinely affordable housing scheme right now,” Deputy Barry said.
“Unfortunately Fianna Fail’s Housing Minister seems to be more attentive to the needs of developers than he is to the needs of workers.
“This Bill will sail through Cabinet but I think it’s going to face a lot more scrutiny when it comes before the Dáil itself.”
Social Democrats TD Cian O’Callaghan said the shared-equity scheme, in particular, will drive up the price of new homes.