Help to buy has revitalised the sector say C.I.F

THE Construction Industry Federation (CIF) has warned that any withdrawal of the Help-To-Buy (HTB) Scheme will further restrict Ireland’s housing supply and compound the housing crisis.

“The Help To Buy scheme has been a significant contributor to the growth in residential construction activity. Any suggestion of a withdrawal of this scheme could have a detrimental impact on confidence and the ability of house builders to maintain and increase their residential building programmes,” said CIF Director General Tom Parlon.

“The Scheme has created a viable market for first time buyers and that has meant that banks have begun to lend once again to builders who are building starter homes again,” Tom Parlon said.

“The house price inflation that we are seeing, is happening in the vast majority of cases, in the second-hand home marketa market that those availing of the Help To Buy Scheme are not involved in,” he said.

“If the price of a new home is €250,000, it will cost the government €15,000 or so under the Help to Buy Scheme and yield €100,000 in direct and indirect revenue - that’s more than a six-fold return to the exchequer,” Mr Parlon said.

“Residential building has been made more viable in key locations on account of its introduction by assisting prospective house purchasers with the deposit level, which is now required under the Central Bank’s mortgage lending rules on Loan to Value. It is quite simple; first time buyers can buy homes, so building them becomes viable.”

In a submission to the Independent Impact Assessment for the Minister for Finance of the Help to Buy Tax Incentive, the CIF outlined the body’s considered opinion that the crisis in housing supply had warranted the temporary introduction of the HTB scheme in 2016 to assist in: the viability of new residential building, and the ability of first time buyers to purchase a new home.

Members of the Irish Home Builders Association, a constituent association of the CIF which represents residential building members, have also expressed their full support for the HTB scheme.