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\nThe LDA is the State body responsible for developing affordable housing<\/p>\n
The Government’s new housing plan promises that a minimum of 300,000 new homes will be built by 2030, including a target for the State to deliver 72,000 social homes.<\/p>\n
Taoiseach Miche\u00e1l Martin denied that the absence of annual targets meant there would be no accountability.<\/p>\n
David Murphy outlines five takeaways from the new plan.<\/p>\n
LDA the big winner<\/p>\n
\nThe LDA is the State body responsible for developing affordable housing<\/p>\n
Perhaps the biggest winner from the latest housing plan is the Land Development Agency.<\/p>\n
It is the State body responsible for developing affordable housing.<\/p>\n
Today’s plan confirms it will receive an additional \u20ac2.5 billion, giving it a total of \u20ac8.75 billion, of which \u20ac1.25 billion is borrowings.<\/p>\n
While well flagged, it does give the LDA enough financial firepower to finance its activities until 2030.<\/p>\n
Its role is also expanded to cover a wider geographical area and to acquire more land.<\/p>\n
Over the coming years, the LDA is going to have to consider recycling some of its money by selling some of its properties or partnering with a fund.<\/p>\n
No annual housing targets<\/p>\n
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\nToday’s plan promises 300,000 homes by the end of 2030 (stock image)<\/p>\n
This housing plan has no overall targets for the number of homes which it hopes to see built annually.<\/p>\n
That is a significant change from the previous programme, which set forecasts for each year.<\/p>\n
Instead, today’s plan promises 300,000 homes by the end of 2030. Including this year’s housing output, that is an average of 50,000 homes per annum.<\/p>\n
The argument put forward by the Taoiseach is that including specific annual targets for the overall housing market was a ‘no win’ for the Government.<\/p>\n
The Coalition was criticised for a lack of ambition when the projections were exceeded and ministers took more flak when forecasts were missed.<\/p>\n
But there is another factor.<\/p>\n
The Government can’t control how many homes are delivered by the private market.<\/p>\n
About half of the new homes are built without State support.<\/p>\n
The job of the Cabinet is to create conditions for residential construction. It is up to developers to decide whether to proceed or not.<\/p>\n
Solving the apartment problem<\/p>\n
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\nThere are now indications that developers will go ahead with projects which had stalled<\/p>\n
Today’s plan needs to be seen in the context of wider changes introduced by Minister for Housing James Browne to increase the construction of apartments after they recently stalled.<\/p>\n
The relaxation of building standards for flat complexes, significant changes to rent controls and a reduction in VAT from 13.5% to 9% on apartments will help stimulate activity.<\/p>\n
Those steps were in response to last year’s disastrous housing figures which fell far below expectations, partly due to a 24% drop in apartment construction.<\/p>\n
There are now indications that developers will go ahead with projects which had stalled.<\/p>\n
But it could take two to three years before there is a significant increase in completions.<\/p>\n
What is the plan for first-time buyers?<\/p>\n
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\nThe Help-to-Buy programme and the First Homes scheme will be continued<\/p>\n
The State’s two schemes which aid first-time buyers will continue until the end of 2030.<\/p>\n
The Help-to-Buy programme allows a purchaser to reclaim up to \u20ac30,000 in tax paid in the past from the Revenue Commissioners towards a deposit.<\/p>\n
The First Homes scheme, in which the State takes a stake in a first-time buyers home, will also be continued.<\/p>\n
It is also being extended to include derelict properties which are being brought back into use.<\/p>\n
The criticism of both programmes is that by giving purchasers more money, they simply add to property prices without increasing supply.<\/p>\n
Infrastructure: Lots of money won’t solve everything<\/p>\n
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\nThe Taoiseach said that the ‘risk appetite is changing in terms of getting things done’<\/p>\n
The housing plan commits huge sums to boost infrastructure to ensure housing projects proceed.<\/p>\n
That includes finance for water supplies, transport connections and extending the electricity grid.<\/p>\n
But many large projects are being held-up in the courts.<\/p>\n
Perhaps the most critical is the Greater Dublin Drainage Scheme, which will treat sewage from Dublin, Kildare and Meath. The original planning application for the project was submitted in 2018.<\/p>\n
It is currently being delayed by a judicial review. It is critical to the provision of future housing.<\/p>\n
If delayed any further, it could jeopardise the ability of local authorities to give planning permissions for new homes from 2028 onwards in north Dublin.<\/p>\n
Today the Taoiseach indicated that the Government is prepared to introduce new bespoke legislation to ensure the Greater Dublin Drainage Scheme and other important infrastructural projects go ahead.<\/p>\n
He said new measures will be brought to Cabinet in the coming weeks but acknowledged they too could face legal challenges.<\/p>\n
“The risk appetite is changing in terms of getting things done.”<\/p>\n
He added: “This is a project that cannot wait.”<\/p>\n