Government's shared equity home loan scheme dubbed 'Bertie economics'

Social Democrats housing spokesperson Cian O'Callaghan said the plan will drive prices up and not deliver the type or numbers of housing needed.

Social Democrats TD Cian O'Callaghan said the only people lining up in favour are the Housing Minister and the developers who lobbied for it. Photo: Sasko Lazarov / RollingNews.ie

The Government's shared equity home loan scheme has been dubbed "Bertie economics".

Social Democrats housing spokesperson Cian O'Callaghan today said that the plan will drive prices up and not deliver the type or numbers of housing needed. Mr O'Callaghan said the plan should be scrapped. He said that Housing Minister Darragh O'Brien stood alone in his support of the scheme.

"This plan will drive up prices and put money in the pockets of developers. There's a strong line-up of people against this plan, from the Central Bank, ESRI, the Department of Public Expenditure and different commentators.

"The only people lining up in favour are the Housing Minister and the developers who lobbied for it.

"The last time we saw a government inflate house prices by bringing in subsidies for developers, it ended very badly. 

This is a return to the era of Bertie economics and really, it's time that the Government learns from the mistakes of the past and put the money into local authority direct builds.

Mr O'Callaghan said that Monday's vote of Dublin City Council to make the 853-home Oscar Traynor Road development 100% social and affordable housing was a template for what could or should be done.

"That is a mixed tenure scheme on public lands and that is what should be done."

Under the plan, €75m will be allocated to allow the Government offer equity loans of up to 30% on new-build homes under €400,000. The scheme will have no salary cap and will be aimed at allowing younger people purchase their first homes.

The Government's shared equity loans scheme must be scrapped, @OCallaghanCian says. It's a return to "Bertie economics". pic.twitter.com/NOJCSFYPme

— Social Democrats (@SocDems) March 2, 2021

Sinn Féin will this week bring a motion to scrap the scheme to the Dáil. Its housing spokesperson Eoin O Broin said the plan will simply add to people's debt.

“The Fianna Fáil plan will not make homes more affordable and it will saddle working people with too much debt. It will not help a generation that has been locked out of homeownership due to the rising cost of homes.

“It is not just Sinn Féin that thinks that this scheme should be scrapped. A group of councillors from Fine Gael wrote to the Minister for Housing urging him to scrap the Shared Equity Loan scheme as it risked a ‘return to failed housing policies of the Celtic Tiger era’."

Mr O'Brien told the RTÉ News At One that he had no plans to abandon the scheme.

He said that "properly calibrated" the scheme had merit.

"I want to make sure that the scheme is targeted at those in the affordability trap."

He said that scheme would not lead to higher prices of homes and said that he was "working closely" with the Central Bank to ensure that it approved the loans.

He said that criticism from auctioneers that the plan was merely targeted at "getting around Central Bank lending rules" was made without seeing the scheme in its entirety.

Mr O'Brien said that the scheme was "not one silver bullet" and was 2% of his department's entire budget.