Saturday 18 August 2018

Government to consider buying property from developers to encourage the building of new homes

Housing Minister Eoghan Murphy. Picture: PA
Housing Minister Eoghan Murphy. Picture: PA
Independent.ie Newsdesk

Independent.ie Newsdesk

The Government is considering buying property 'off the plans' from developers in a bid to encourage them to build more homes.

In a fresh attempt to solve the housing crisis, the Government has outlined a strategy that hinges on the Part V scheme, that obliges builders to construct a number of homes on land zoned for development.

According to the Irish Independent, the Government will consider the purchase of additional Part V units on select schemes.

In a document seen by the Irish Independent, the Government said that this "reduction on risk will ultimately reduce development margin".

The Government hope that by buying the property before homes are built, it will make it easier for developers to get finance.

The Part V scheme has been criticised by developers as it has been seen as an "obstruction" to the housing market.

But the Rebuilding Ireland document, seen by the Irish Independent, says the policy will solve the housing crisis.

The paper states: “Despite much talk of available finance, the reality is that the finance market for residential delivery has contracted significantly.” It argues the “de-risking of residential projects is key to attract reasonable finance levels”.

The Government hopes that the plan will allow developers to “deliver units at affordable levels”.

A spokesperson for the Department of Housing described the report as “part of a Rebuilding Ireland observation” designed to examine “housing delivery input costs”.

He said its aim was to “consider areas where economies can be achieved” and claimed:  “It is the intention therefore that actions arising out of the completed report will assist in achieving a more economic product within the marketplace”.

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