Ahern targets middle-income house-hunters with developers deal

HOUSING Minister Noel Ahern is “hopeful” of brokering a deal with developers that will allow more than 25,000 middle-income earners squeezed out of the property market to buy their first homes.

There were 77,000 homes built here last year and one-third of these households in the future will have difficulty buying their own homes, according to the national housing agency Threshold.

Mr Ahern revealed that there is an acceptance among some builders that they must provide more affordable houses particularly for people who have been squeezed out of the market in recent years.

"There is a corporate social responsibility among some developers and a recognition that the present situation cannot continue where some new houses are costing €1 million," Mr Ahern said.

The minister is hoping to secure a deal with the Construction Industry Federation and Irish Home Builders Association where new homes costing €200,000 outside Dublin and €250,000 in the capital would be brought to the market.

Asked if the Government is offering the developers any sweeteners to deliver this deal, Mr Ahern said: "We are hoping that this will not be necessary if the houses are built on State land, or if builders could increase density in a tasteful manner."

But Mr Ahern said it was possible that some tax incentives or subsidies could be offered to the builders to secure the deal. The minister said he was hopeful this deal and a more comprehensive housing package would be delivered by the Government before the summer recess.

Mr Ahern told the National Housing Conference in Cork that the Government has already allocated €2 billion to providing social and affordable houses this year. This will allow 5,500 social houses and 1,800 affordable houses to be built.

But the National Economic and Social Council (NESC) in a comprehensive report to Government last year said this is not enough and at least 10,000 social houses must be built every year for the next decade to keep pace with demand.

NESC director Rory O'Donnell told the Cork conference, attended by more than 400 delegates, that an adequate stock of rented houses at affordable prices are needed.

But Threshold director Aideen Hayden hit out at the minister's proposal to give builders tax incentives of subsidies to provide more affordable homes for middle-income earners.

"This will just be another scheme to line the pockets of already wealthy developers the Government should put the money into helping people on minimum wage to secure a home," said Ms Hayden.

But Irish Home Builders Association spokesman Hubert Fitzpatrick said they would welcome any joint venture with the Government that would increase the supply of affordable houses, including the supply of State land and tax incentives.

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