The new Affordable Housing Bill will be in place in time for summer according to the Housing Minister.
The bill aims to empower the Land Development Agency to build affordable homes on state-owned lands, make it easier for councils to deliver affordable homes and introduce a new affordable rent scheme.
It is the fourth strand of the bill that has come in for criticism from opposition parties and a number of State agencies however.
The shared equity scheme will see the Government taking on a stake of up to 30% in a house, where purchasers can’t afford the full mortgage.
The plan will be available to first-time buyer purchasing homes costing up to €400,000; however, there will be different price caps in different areas.
The ESRI has raised concern over the plan, warning that it would “very likely lead to higher house prices,” while the Central Bank warned it could leave mortgage holders with unaffordable debts.
The Sinn Féin housing minister Eoin Ó Broin said it would benefit developers, increasing house prices and the debt burden on homeowners.
On The Hard Shoulder this evening, Minister Darragh O’Brien again defended the bill, labelling opposition criticism of it “hysterical.”
“The shared equity piece is a very targeted arrangement and it is targeted at helping people bridge that affordability gap,” he said.
“You are looking at about €75m from the Exchequer. I would expect over a three-year period to be able to help about 2,000 households or potential homeowners – a lot of whom are paying of up to €2,000 a month and if they could get a mortgage, they would only be paying €1,000 a month.
“But I am going to bring in regional price caps with it. We are going to have eligibility checks and background checks. It is not going to be a second mortgage as some people have actually said.
“There has been, in some quarters, a bit of an hysterical response to it – people knocking a scheme before they have even seen it but, in broad terms, the discussion around it has been very good.”
He said the scheme will offer hope to people who are trying to save a deposit but can’t access a mortgage.
“I believe in home ownership and I think it is an honest and a just aspiration for people to have and the State should support it,” he said.
He said he hopes to see bill passed by the Oireachtas in time for the summer recess.
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