The private sector will supply the majority of housing to be built under Government targets for the next 10 years, internal documents show.
During a key meeting on Tuesday to sign off on housing reforms, Ministers were given a breakdown of “tenure types” which will contribute towards the Government’s target of an average of 33,000 homes per year over the next decade.
The projections, which were developed by the Department of Housing and Economic Social and Research Institute (ESRI), show private ownership and private rental units will contribute 11,800 and 6,500 units each annually, on average, over the next decade – just over 55 per cent of the yearly output.
Affordable housing units (at 4,100 annually) and new social housing units (10,300 per year) will make up the balance. Cabinet briefings also show Ministers were warned apartment development could “disappear” if a new, higher level of stamp duty were to be applied to apartments.
The Oireachtas voted in favour of Government plans to introduce a 10 per cent stamp duty on house purchases of 10 units or more, but held back on extending the new, higher rate of tax to apartment purchases.
Ministers were told if apartments weren’t exempted “there is a significant risk that developers would exit from the apartment building market as such projects would no longer be viable, and an important element of our future housing strategy would disappear”.
Industry and Government sources told The Irish Times that exempting apartments from higher stamp charges had been a policy goal sought by the sector as the reforms were being worked on.
Opposition figures criticised the anticipated contribution to housing targets from the private sector. Rebecca Moynihan, Labour's housing spokeswoman, said: "That approach has failed. The private sector has had five years of incentives and we still haven't come close to affordable rental and to buying homes we need."
Affordable homes
Sinn Féin housing spokesman Eoin Ó Broin said the Government should publish how many affordable homes will be delivered in the next three years. “Offering up back of the envelope 10-year averages is not a plan. It is wild speculation.” He said a dramatic increase in spending was needed to deliver required volumes of social and affordable housing. Cian O’Callaghan, Social Democrats housing spokesman, said reliance on the private sector is “pushing up rents and house prices” due to competition between buyers, funds and State or non-profit bodies.
A spokeswoman for the Minister for Housing said the figures for individual tenure types were projections rather than targets themselves, and were the outputs of modelling undertaken by the ESRI and the department, who developed a Housing Need and Demand Assessment (HNDA) tool with the Scottish Centre for Housing Market Analysis.
“The HNDA tool uses the ESRI’s household projections for each local authority and data on income, rents and house prices from a number of sources,” the spokeswoman said. “The figures are not targets, they are an evidence-based estimation of the reality of the circumstances of those households within the different tenures based on the best available data and enable a better understanding of how many households are likely to need State support.”
They estimate how many people can rent privately, purchase homes, need social housing support, or will need affordable homes or cost rental, she said, arguing the State cannot provide 33,000 housing units annually. “It is simply reality that private sector investment will be required to meet the balance of the demand while the State ramps up social and affordable housing.”
She said Minister for Housing Darragh O’Brien “has said that refusing to use the private sector is to fight with one hand behind our back”.
