Vienna-style housing plan is needed - Cork Chamber

Investment fund and subsidy scheme provides loans and land

Cork Chamber President Ronan Murray and CEO Conor Healy at the launch of their Pre-Budget Submission. Photography By Gerard McCarthy

A Vienna-style urban housing investment fund should be set up in Ireland to help tackle the housing crisis, Cork Chamber has said in its pre-budget submission.

The business representative body has called on the Government to mandate the Irish Strategic Investment Fund (Isif) to set up the investment fund to accelerate the delivery of much-needed housing.

Cork Chamber chief executive Conor Healy said: “The Government needs to think differently on measures that can solve the housing crisis and mandating Isif to set up an urban housing investment fund modelled on Vienna’s Wohnbauinitiative (WBI) would unlock affordable housing in cities and provide a steady return for the State. It is this kind of innovative approach that is required to unlock the high-density, high-quality housing that we need in Irish cities.”

The WBI is an investment fund and subsidy scheme that provides finance, medium-term, low-interest loans and low-cost building land to support new housing and apartment construction.

The chamber’s pre-budget submission also highlights changes needed in the Government’s Croí Cónaithe scheme to enable development at the pace.

“The scheme currently ignores the extensive viability gap still present in the built-to-rent (BTR) sector which is inhibiting development from progressing beyond the planning stages. A mechanism to underwrite the financing of new developments is needed to ensure the BTR sector delivers a diverse and affordable housing stock for more inclusive growth.

“In addition, the Croí Cónaithe scheme that supports built-to-sell sees payment only made on completion which doesn’t overcome the initial financing barriers,” said Mr Healy.

Pointing to the substantial hike needed in the overall capital spend in the budget on affordable housing in urban areas, Chamber president Ronan Murray said: “Cost rental has worked well to date but future schemes are being jeopardised by inflation and increased costs of financing. Income thresholds need to be increased and rents tiered, so that schemes are financeable and affordable, and that anyone earning more, pays more.”

Mr Murray added: “Budget 2023 comes at a time of increased financial pressure and uncertainty for businesses and we need new measures to support businesses in the budget, but it does present an opportunity to continue to invest in vital medium and long-term capital investment plans and in urban infrastructure and housing.

“We are calling for investment and new measures in housing, strategic supports for balanced regional growth across the country, investment in the green energy transition, infrastructure, and transport to attract and retain the talent our companies need to succeed while generating a positive impact on business, communities, and livelihoods.’”