No shortage of housing projects in dire need of funds from Budget 2018

OF ALL the cabinet members looking for cash in the Budget, Housing Minister Eoghan Murphy’s pleas for funds are probably the most understood by the public.

Solving the housing crisis will take enormous amounts of money, not to mention implementing a range of policies aimed at encouraging owners of vacant homes to allow them to be used to house families. But he will be in competition with other high-spending departments including social protection, health and education.

The first priority will be sourcing additional money for the social housing programme. Figures released yesterday show the homeless crisis is still nowhere close to being resolved, with the number of adults, children and families without a home at previously unseen levels.

The Government spent €935m last year on social housing, securing some 19,000 units through a mix of new-build, acquisitions, long-term leasing, rental payments to landlords and returning existing stock – known as voids – back into use. Some €1.3bn is projected to be spent in 2017 on 21,000 units. If the Government wants to deliver 25,000 new units next year as set out in its action plan ‘Rebuilding Ireland’, a budget of some €1.6bn will be needed, an additional €300m or so.

The Government has also committed to increasing the build programme, so more money will be needed here too, but that’s likely to form part of the new capital programme due at the end of the year.

The homelessness budget has increased over recent years, and additional funding is likely to be sought for Budget 2018.

A big issue has been making use of the 180,000 vacant properties which the Central Statistics Office says are dotted across the country. A number of carrots have been dangled in front of owners, including the Repair and Lease and Buy and Renew schemes where the State offered to buy the units, or pay to have them upgraded, and then lease them for up to 10 years.

It’s likely the Repair and Lease scheme will be reviewed, which could include reducing the minimum period to lease, and a stick is also being considered, which could be in the form of a vacant homes tax. The Taoiseach has indicated this is being considered.

There is also the prospect of measures to allow aboveground floor commercial units to be used as homes. Among the possibilities are State funding to convert units, or perhaps a tax break, to bring more homes into the private rental market.

It appears the Government has moved away from the idea of trying to ask owners of properties currently residing in nursing homes to consider renting their properties, which could be a missed opportunity. Discussions with the HSE suggested primary legislation would be needed.

Tax treatment of landlords is also an issue. The Government has indicated the amount of mortgage relief landlords can deduct will rise to 100pc by 2021. It currently stands at 80pc, and the full 100pc could be fast-tracked. This would cost around €56m. Landlords also want the Local Property Tax to be tax deductible, which would cost around €28m a year.

Among the big plays proposed by the Taoiseach is looking at Nama to help alleviate the housing shortage. It is mandated to deliver 20,000 units by 2020. While the State ‘bad bank’ holds lots of land, a lot of which is in areas of high-demand including the capital, as of the end of July it held around €1bn in cash or equivalents – the vital ingredient to ramp up supply. The Government could look at it becoming a funder for housing development, while developing the sites it already controls.