#Budget19: Extra funds to build and buy social housing

#Budget19: Extra funds to build and buy social housing

An extra 10,000 council homes are to be added to the social housing supply next year through a combination of new builds, purchases, and long-term leasing — despite criticisms that leases should not count as additional stock, writes Caroline O’Doherty

Both local authorities and non-profit housing bodies will be involved in providing the additional housing, with some of the purchases of existing homes to be made from banks in possession of vacant dwellings.

A further 17,400 individuals and families in urgent need of housing will get private rented accommodation through the HAP and RAS rental schemes.

The measures are part of a €2.4bn plan to ease the housing and homelessness crisis which has beset the Government — a fund that is 25% greater than the figure made available this year.

Some of the money will be used to provide 200 extra emergency beds for the homeless, as well as 950 new ‘family hub’ places to get homeless families out of hotels and into more suitable accommodation while awaiting permanent housing.

Any further inroads into the crisis will have to wait beyond 2019, however, as other key planks of the public housing strategy will take at least until 2020 to begin making an impact.

Finance Minister Paschal Donohoe admitted there was a long road ahead. “I acknowledge that where we find ourselves today is not where we want to be,” he said.

There is much work to be done to reduce the level of homelessness, to find permanent solutions for those in temporary and emergency accommodation and to improve affordability for those on low and middle incomes.

One of the single biggest investments to be made is a €210m injection into the as yet unused serviced site fund for the construction of affordable housing for low and middle- income earners, bringing the money allocated to the initiative up to €310m.

It is intended that more than 6,000 new homes would be built under the scheme, the first being completed in 2020.

Under the arrangement, local authorities will identify land for home building and prepare the sites with all the necessary road, sewage, and power infrastructure. Central government will fund this work to the tune of €275m with the local authorities making up the remaining €35m.

The local authorities then take full charge, either building homes directly, contracting the work out to developers, or entering agreements with non-profit housing bodies.

Individuals earning under €50,000 or couples earning under €75,000 will be eligible to apply for the scheme and the prices of the homes will be capped at around €260,000, roughly the mortgage borrowing limit for a couple with a combined income of €75,000.

Depending on location, homes built under the scheme could cost much less but, in general, it is envisaged the subsidised site preparations would knock up to 40% off the market price for an equivalent privately-built dwelling.

Housing Minister Eoghan Murphy said, in total, he expected 25,000 new social and private homes to be built next year but he said demand would still outstrip supply so there would continue to be a heavy reliance on the private rented market.

He is bringing forward plans to lift restrictions on the tax relief landlords can claim on mortgage interest paid on loans for the purchase, improvement, or repair of rented properties. Relief will increase to 100% from January.

Mr Murphy defended the move by saying ideology should not stand in the way of practical solutions to the housing shortage.

We’re overly dependent on small and sometimes accidental landlords for our rental accommodation,” he said. “We have to introduce measures that will incentivise landlords to remain as landlords.

In tandem with the tax breaks for landlords, he said he would be strengthening the rights of renters, with new legislation to be introduced in the next few weeks to increase sanctions for breaches of rent caps in rent pressure zones, a possible extension of the zones, and extra funding for the Residential Tenancies Board to carry out inspections of rental properties.

‘It’s not fair that people as young as 17 are paying €400 to €600 a month for a bunkbed’

By Joyce Fegan

Approximately a quarter of a million people are registered as third-level students in Ireland and with some paying €600 a month for a bunkbed in a cramped house, accommodation is currently one of the biggest barriers to education.

Conor Kelly
Conor Kelly

Conor Kelly, 19, a first-year student at the Institute of Technology in Blanchardstown, has seen the “disgraceful” accommodation some students live in and is one of the thousands of activists who joined the recent housing protests.

It’s not fair that people younger than me, minors, as young as 17 in some cases, are living in this disgraceful accommodation, paying €400 to €600 a month for a bunkbed,” said Conor.

“I have friends in accommodation that are being treated less than human. The showers aren’t working. The water doesn’t work for days on end. Sometimes the electricity isn’t working.”

In a specific incident, Conor, who’s studying youth and community development, was aware of a landlord turning off essential services in a house, rented by students.

“In one incident a landlord turned off the electricity and water to push student tenants out. In incidences like this, that’s done to either get new tenants in and jack up the price or to sell the building. These are people who want to study as hard as they can, and accessing accommodation is a big barrier,” said Conor.

In another situation, Conor is aware of there being up to 40 people living in a small house near Dublin City centre.

“In a small house near Dublin City, there was one situation where the landlord had up to 40 students in the place, with three to four bunkbeds in a room. The place was cold and dirty and would have been too small for a family of five, never mind 30 to 40 people who are wanting to study.

It’s immoral. It’s the definition of immoral.

You’re taking advantage of someone who needs accommodation at a certain price because they’re studying full-time to make a better life for themselves,” Conor said.

While third-level education is technically free, the student from Cabra in Dublin 7, currently has annual registration fees of €3,200, as well as travel costs.

“The average living cost for a student is €12,500. This includes your registration fees every year. Mine at the moment cost €3,200.

“I have the SUSI (Student Universal Support Ireland) grant, so for the time being, my annual fee is covered. My transport every month is €80,” Conor said.

Conor was recently involved in the large housing protest on October 3, where several thousand people marched to Leinster House, under an umbrella campaign called Raise the Roof.

Through the Union of Students of Ireland I got involved in Raise the Roof. I’m very organised so I love to help facilitate a protest and make sure everyone is safe.

“Getting behind the housing campaigns is our way of helping. I think our generation learned from the recent marriage and repeal referendums, people my age are learning from movements like those.

“In the age of social media it’s much easier to spread information with Facebook and Twitter and instant messages. I think we are so active because we realise these issues are so complicated and we need to stop sitting down and stand up for ourselves.”

‘Spin, but no substance’ says mum forced into homelessness

By Aoife Moore

A young mother of two who spent 14 months in emergency homeless accommodation says the budget offered “plenty of spin and no substance” for those experiencing homelessness.

Opposition parties were quick to criticise the Government for failing to do enough to improve housing in Ireland in the budget, in what has been labelled the worst crisis in the history of the State.

Marie O’Sullivan, 31, from Cork, who was on the housing list for 13 years before being forced into homelessness in March 2017, said she is not surprised at the announcements, and said the budget does not go far enough to tackle the issue: “There’s plenty of spin and little or no substance to actually make a real difference at a time when it is most necessary.”

Marie O'Sullivan
Marie O'Sullivan

Ms O’Sullivan, along with her husband, teenage son and seven-year-old daughter, were living in a privately-rented property for five years before the owner decided to sell the home and the new owner did not want tenants.

The family attempted to find a suitable and affordable home but eventually had to leave their property and enter emergency accommodation — in hotels and a holiday apartment.

It is a shameful one-size-fits-all approach, can this Government really believe that the public will be so easily appeased at a time when our healthcare and housing have long passed crisis point?” she said.

“I see no real solutions towards ending the housing and homeless emergency. A bit of extra cash thrown at already tried and failed initiatives and policies will do next to nothing to resolve this situation. Where is the specific allocation of funding to freeze rents, funding for overcrowded and overstretched emergency shelters? Where is the plan to spend money supporting the more than 10,000 citizens currently experiencing homelessness? At a time when it has never been more financially rewarding to be a landlord, the budget gives them a tax break, it’s insult to injury. I think today is a very grim day for anyone experiencing homelessness, in fear of losing their homes, trying to buy a home, struggling to pay rent or unable to find student accommodation. If any mother sitting in a hub or hotel room had put any faith in this budget based on the Fine Gael soundbites prior, then I’d imagine they’re feeling pretty dismal right now.”

Almost 10,000 people are homeless here, including more than 3,800 children, the latest official figures show.

A €300m affordable housing package has been allocated in this year’s budget.

The Labour Party’s housing spokeswoman, Jan O’Sullivan, described the affordable housing scheme as a “direct subsidy” to developers.

While welcoming certain housing measures, such as the allocation of additional funding to homelessness and more funding for the construction of social housing, Fianna Fáil’s Michael McGrath said the Government has failed to get to grips with the housing crisis.

It is the Government that is responsible for addressing the housing crisis and it is the Government that must accept its performance on housing has not been good enough,” he said.

He added that the Government should cut out its obsession with spin and focus on delivering homes instead.

“The number of people sleeping in emergency accommodation is a national scandal and a scar on our nation at present,” he said.

Weak housing measures fail to impress

By Caroline O’Doherty

Housing and homeless charities were largely underwhelmed by the budget measures aimed at tackling the crisis while opposition parties declared them a ‘slap in the face’ for people desperately in need of solutions.

Focus Ireland welcomed the increase in overall funding but said the package of measures was “not the game-changer” that was needed.

“Despite the last three budgets being mooted as ‘housing budgets’, they have essentially been firefighting rather than deal with causes,” chief executive Pat Dennigan said. He said he was disappointed that the charity’s call for the introduction of a vacant home tax to bring empty dwellings back into use had not been heeded.

Simon Communities similarly welcomed the funding boost but expressed concern at the modest targets for increasing social housing and the lack of firmer action on affordability.

There is a commitment to providing 10,000 [social housing] units through acquisition, refurbishment and new build. There are at least 100,000 households in need of social housing,” said Simon spokesperson, Niamh Randall.

She said she was also concerned that the increase in the numbers to get housing assistance payments reinforced the State’s reliance on the private rented sector when the underlying problem was the lack of affordable homes.

She said the value of the HAP should have been increased as the majority of properties for rent were not affordable, and she questioned why landlords were getting tax breaks when tenants were not. The Irish Property Owners Association welcomed the move.

The Peter McVerry Trust was more positive, saying the combination of measures announced would ease the pressures on the housing system. Trust chief executive Pat Doyle welcomed the €60m allocated to capital spending on homeless services. “It means we can acquire buildings and then when no longer needed for emergency accommodation, we can flip them into social housing units,” he said.

He also welcomed the measures on affordable homes, saying they would help people trapped in the rental system to buy their own homes and free up rental properties for those exiting homelessness.

The Construction Industry Federation asked why plans for the Help To Buy scheme —to expire next year — were not clarified. “This will create uncertainty next year for both first-time house buyers and homebuilders,” it said.

The Irish Council for Social Housing said the budget was a lost opportunity for fresh thinking to create a new affordable rental sector.

The Social Democrats said the social housing targets were unambitious and insufficient and the tax reliefs were a slap in the face for renters.

“There is nothing in this budget for hard-pressed renters. Instead, landlords have received another tax break.”

Solidarity/People Before Profit said the measures were “a miserable drop in the ocean” of what was needed.

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