FIRST-TIME buyers breathed a sigh of relief alongside the construction sector with news that the Help-to-Buy scheme is to be extended in its current form for two more years.
The property sector claims the tax relief plan that got house-building sites moving again since its introduction five years ago is still vital to keep house-building on track.
The scheme, which permits first-time buyers relief of €20,000, has been availed of by 14,000 buyers at a cost of €200m and was due to expire at the end of December.
Last night, Pat Davitt of Irish Professional Auctioneers and Valuers, which represents more than 1,300 property professionals, welcomed the decision to extend.
"The scheme is central to giving confidence to both first-time buyers and smaller builders and developers, as opposed to the few dominant and strongly capital-backed players," he said.
While an extension was expected, the big surprise was the lack of a cap being introduced (expected at around €350,000) in order to prevent wealthy home buyers from benefiting, but also to push builders towards affordable home types that Irish cities need most.
The scheme has been criticised for generating homes that low- and middle-earners cannot afford.
Overall, the Finance Minister announced that the national housing budget for 2020 is being increased by €258m to €2.63bn, up 11pc on 2019.
There will be capital funding of over €1.1bn allocated to support the delivery of 11,000 new social homes in 2020, with plans for a further 12,000 the following year.
An additional €80m will be allocated for the Housing Assistance Payment scheme (HAP) for 2020 while, vitally, an additional €20m will be added to the overall planned spend on homelessness; taking the 2020 spend up to €166m.
Housing Minister Eoghan Murphy welcomed the increase in funding and added: "We have to make home ownership a reality for more people, and we have to make the provision of housing, be it renting or buying, more affordable."
Mr Murphy will clarify the finer points of the additional housing spends in a statement to be issued before noon today. However, thus far it has been revealed that:
:: There will be increased funding of €9m for the Residential Tenancies Board to help it clear backlogs of mediation processes and pursue its duties generally;
:: Local authorities will receive €6m to increase rental inspections. A sum of €2.5m for local authorities will go towards the implementation of reforms of the short-term letting sector;
:: New cost-rental projects are to be progressed and, with the help of the European Investment Bank, the development of a new policy framework to allow cost rental to roll out nationally;
:: A sum of €126m is be allocated under the Serviced Sites Fund to support more affordable homes;
:: Around €45m will go toward retrofitting homes as part of the Climate Action Plan and 1,000 social homes will be upgraded under the Energy Efficiency Programme through funding of €25m;
:: A further €20m from new carbon tax receipts will fund a programme of deep retrofitting of circa 600 social homes in the midlands;
:: A sum of €130m is earmarked for regeneration of cities and towns. Funding for subsidised housing will increase to €126m in 2020 while the Mortgage-to-Rent scheme gets €23m.
Comment & Reaction
THE Budget increase of €20m to fight homelessness in 2020 has been welcomed tepidly by aid organisations on the ground who described it as a token gesture at a time when homelessness has surpassed 10,000 and more than 100 children a month are being added to emergency accommodation lists.
Comment & Reaction
TO UNDERSTAND the importance of this Budget for housing, we have to consider that the Help-to-Buy scheme has been the single most effective aspect of Government policy since the start of the housing crisis.