Households earning up to €90,000 a year would be eligible to buy affordable homes starting at €300,000 under a new Sinn Féin affordable housing plan – but the State would retain ownership of the land the homes are built on with ongoing conditions on the sale and rent of the home.
The plan, unveiled by the party in Dublin today, also promises rents at or below €1,000 a month, with renters and purchasers who earn too much to qualify for council housing but who cannot purchase a home being targeted.
Sinn Féin says it can separate the cost of land and site servicing from the cost of building the home in order to bring prices down. “In essence under Sinn Féin’s affordable purchase scheme the state pays for all land related costs and retains ownership of the land,” the document outlines.
“The purchaser buys the home, at the cost of construction, and is given free indefinite use of the public land subject to a legally binding covenant providing them, their children and subsequent generations free indefinite use of the public land subject to two conditions.”
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The property would not be eligible for rental in the private rental sector, and if the owner has to move away, it can be rented out temporarily with the price set under local authorities affordable rental scheme. If the owner sells the property, they can sell it to another affordable purchaser at a price determined at the time, which the party says will ensure “permanent affordability” for subsequent buyers.
The party’s policy document – the first in a series of initiatives to be launched in the coming weeks culminating in the publication of its full plan in early September – promises 50,000 affordable homes to rent and buy over five years, costing a total of €13.2 billion.
This would be made up of €6.9 billion in voted exchequer funding, alongside €6.3 billion in “non-voted expenditure” including borrowing by local authorities and approved housing bodies from the Housing Finance Agency “and other sources”.
The party’s document outlines that housing costs for renters in cost rental schemes should be no more than 33 per cent of net income and less where possible, with mortgage costs in affordable purchase no more than 33 per cent of net disposable income.
Affordable purchase schemes would account for half the homes under the plan, with prices between €250,000 and €300,000 depending on size and location for households with mortgage approval and gross household income up to €90,000.
That price range would be “kept under period review” and adjusted for the movement of wages, construction sector inflation and interest rates.
It says land related costs range from 25 to 29 per cent of the total development cost of a home dependingon location, and that a Public Housing Fund contribution will range from 20-30 per cent of all-in development costs, with development levies waived.**
Mortgage finance would be given under existing rules from bans and other lenders.
Cost rental homes would be delivered to households with a net income of up to €66,000 in Dublin and up to €59,000 outside Dublin. The party says it will deliver homes through AHBs and local authorities with tenancies advertised by the Housing Agency through a centralised portal and on the websites of individual social housing landlords. The party is promising to reform the current bureaucracy that underpins affordable cost rental schemes.
Again, a Public Housing Fund contribution would cover all costs related to land and development levies would be waived, with payments ranging between 30 and 55 per cent of the all in development cost. Again, the state would retain ownership of the land and lease it out free of charge in perpetuity to a social landlord on the condition homes remain at cost rental levels.
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