New housing drive ‘will save buyers up to €80k’

THE Government’s new housing drive will deliver discounts of up to €80,000 on family homes, Housing Minister Eoghan Murphy promised yesterday.

The new commercial semistate Land Development Agency aims to build 15,000 social homes and 45,000 affordable properties over the next 20 years.

Mr Murphy suggested a typical starter home from the LDA could be priced €300,000 in cities and €250,000 elsewhere, based on current prices. However, on the affordability question, he failed to give guarantees or clear answers by insisting there were different definitions of affordability.

‘To explain affordability – generally we talk about a person spending one-third of their income on their mortgage,’ he said.

‘Now affordability varies, depending on what region you live in, but also over time. We have a number of affordable schemes at the moment. They generally set the criteria and an individual has to be earning less than €50,000 or a couple less than €75,000, and then we talk about caps of about €320,000 in the greater Dublin area, with €250,000 in Cork, Galway and everywhere else.’

Asked whether a garda and a teacher would be able to buy a house in Dublin, Mr Murphy told RTÉ Radio 1: ‘One of the things I said when I came into office was that it is not fair that people who fall below a certain minimum (income) threshold get all these types of supports, but people who are just above it don’t.

‘But if you look at the Dublin scenario, last year first-time buyers in the greater Dublin area, Cork and Galway, I think something like seven in ten bought homes for less than €320,000.

‘We want to make housing available so that people like guards, nurses and teachers, people who don’t qualify for social housing but can’t manage to buy a home or rent a home at the moment, [can do so]. This new land will bring those homes on stream and make them available for them.’

Under the plan, a total of 150,000 homes, most intended for sale at market rates, will come on stream over the next 20 years, many in sought-after commuter areas.

Six in ten will be privately sold at prevailing demand, but 30% of each new estate will be dedicated to affordable housing and 10% will be social, meaning council-allotted. The proportion of social and affordable will rise over time to half of all new developments, the Government pledged. It is to bankroll the huge new venture with initial capital of €1.2billion.

Land for 3,000 units has already been secured from the HSE, the Housing Agency and other State bodies, and this includes land in the Dublin areas of Dundrum, Balbriggan and Skerries.

Leo Varadkar, in launching the new superagency – which will have former Nama chief financial officer John Coleman at its head – declared: ‘At the core of the solution has to be more supply. It is definitely the main part of the housing solution.’

The Taoiseach said Ireland’s population increased by 60,000 last year, which pointed to a need for 30,000 new homes per year – only 14,500 were built last year.

He underlined that the new agency would have teeth – not only the ability to apply Compulsory Purchase Orders, but other major powers. Its approach would be prudent and risk-averse, meaning it would not be subject to the cycles of boom and bust that have bedevilled housing provision in Ireland, he said.

Finance Minister Paschal Donohoe said the establishment of the LDA was ‘a really significant, pivotal, strategic moment’.

He said much of the seed capital would come from the Irish Strategic Investment Fund, but that it would be entirely off the Government books, and was a ‘golden opportunity’ to enable a new use of State assets, ‘securing a reasonable return while better responding to the needs of citizens’.

‘Supply is at core of solution’ ‘A golden opportunity’