Homebuyers purchasing more expensive properties in Dublin could be blocked from accessing the State’s vacant property grant, under proposals being considered by the Government.
A cap of €650,000 is being considered on the value of a home eligible for the €50,000 grant, which is paid out for refurbishment of homes that have been vacant for at least two years.
A proposal is being developed for the Cabinet, which is expected before Christmas.
Figures compiled by the Department of Housing suggest some 22 per cent of homes that have sought the grant in Dublin would be in excess of this threshold.
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A Government source said the figure could “move about” as departments are consulted about it, but confirmed €650,000 was the amount under consideration.
The cap would apply in the greater Dublin area (Dublin, Meath, Kildare, Wicklow), with a lower cap of €500,000 in the rest of the country. However, the impact in the rest of the country would be less significant, with less than 3 per cent of applications at a level above this price.
There is no cap currently on the scheme. However, it’s understood that Ministers will be told a cap may be needed as those with the money to buy more expensive homes would also be more likely to be able to afford investment in renovation without State support.
Almost 15,000 applications for the grant, which can be worth another €20,000 if the property concerned is derelict, have been made so far, with more than €200 million paid out to successful applicants who have completed the works to their properties. The grant application process includes self-assessed property valuations but also the most recent purchase price of the property.
[ How rural Ireland is turning to vacant property grants for developmentOpens in new window ]
A review of the scheme last year is understood to have recommended a cap, saying it would reduce “deadweight” – ie funding works that would take place anyway. It found the scheme was making a significant contribution to refurbishing vacant and derelict homes.
The Government is expected to extend the scheme out to 2030, targeting 20,000 payments in that period. An “above-the-shop” grant is also being proposed of up to €95,000 for relevant units, with additional payments where more than one home is being created up to a value of another €40,000, with €5,000 available for expert advice on conversion.
The Coalition is also expected to approve an extension to the period during which works to an eligible property must be completed, from 13 months to 18 months.
Additional top-ups are also to be approved where an entire commercial property is being converted into residential use.
The Coalition expects to spend about €170 million annually on the various vacancy and dereliction schemes covered by the above measures, although the figure is slightly lower than would otherwise be the case if the caps were agreed.
