UK Construction Media

Funding boost for Irish housing market

News   •   Oct 13, 2016 14:52 BST

The Irish government has announced an increase in social housing funding of up to 50% to €1.2Bn has been announced in the budget.

The increase will fund the measures announced under Minister for Housing, Simon Coveney as part of the €5.35Bn Rebuilding Ireland housing action plan.

It is envisaged the investment will meet the housing needs of more than 21,000 households in 2017.

The package includes a €105M increase – 220% more than 2016 – on the Housing Assistance Payment (HAP) used to accommodate social housing tenants in private rented accommodation.

Local authorities will also fund a variety of housing services worth €92M from surplus Local Property Tax receipts, bringing the total housing provision in 2017 to almost €1.3Bn.

The Minister for Housing, Planning, Community and Local Government, Mr. Simon Coveney said: “I said at the launch of Rebuilding Ireland in July that meeting the housing challenge is the key priority for this Government. The package of measures I am announcing with Cabinet colleagues demonstrates the extent of that commitment.

The Budget also includes a tax rebate for first time buyers to help stimulate the supply of new homes. An extension of mortgage interest relief for existing homeowners and changes to Capital Acquisitions tax will also be used to tackle the Irish housing crisis.

Mortgage interest relief will also be improved for Landlords to encourage them to remain in the housing sector.

The news was welcomed by the Construction Industry Federation (CIF), with Director General Tom Parlon describing the measures as a “significant step” towards solving the issue of a lack of homes being built to satisfy demand.

He said: “The CIF’s Irish Home Builders Association welcomes the introduction of this tax rebate scheme aimed at helping first-time buyers to save deposits for starter homes. There is an acute shortage of activity in this sector because first-time buyers cannot secure mortgages. As a result, banks won’t provide finance to home-builders making the building of new starter homes unviable.”

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