The Housing Minister has insisted he’s ‘more than confident’ new affordable housing measures won't drive up house prices.
New legislation from the Government is focused on three strands: making it easier for councils to ‘deliver’ affordable homes on their land; provisions for affordable rent; and a shared equity arrangement particularly focused on first-time buyers.
The latter element would see the State take up to a 30% stake in a house, in cases when the purchasers aren’t able to secure the full mortgage needed.
It will cover homes costing up to €400,000, but there will be different caps in different parts of the country.
The shared equity part of the plan - which was originally revealed last month - has drawn criticism from some opposition parties.
Sinn Féin’s Eoin Ó Broin warning it will not make homes more affordable and could prove a ‘significant risk’ to the taxpayer in the future.
The plan will now be scrutinised by the Dáil, but on today’s Newstalk Breakfast Minister Darragh O’Brien strongly defended the Government’s proposals.
He claimed he's “more than confident” the equity scheme won’t lead to house price inflation.
He argued: “That’s been the criticism of some - and some of those who’ve criticised it, particularly from the political side of things, have actually opposed home ownership measures for the last number of years.
“We’ve looked at this very carefully. I’ve looked at the scheme in England, that has actually worked very well and has not led to house price inflation at all.
“Those who’ve criticised this scheme have actually been calling for it to be scrapped before it has even been published.”
Minister O’Brien noted there will be regional price caps within the scheme, and it has been “calibrated very, very carefully”.
He said there’ll be ‘some sort of cost’ for the homeowners after year five, but they will not be required to buy out the State’s stake.
The minister said there are some people who are paying €2,000 in rent but would have mortgage payments of just over €1,000 if they could secure one.
He insisted: “There are thousands of couples like that - this will help that.
“This will work, and it has been broadly welcomed by those who are actually affected by the affordability issue… those who can’t buy homes.”
