Minister for Housing Darragh O’Brien is pushing to extend and expand the State’s Help to Buy scheme beyond 2025, well into the lifetime of the next government.
The current scheme is due to expire at the end of next year, and Sinn Féin has promised to dismantle the arrangement – which critics say is driving house prices up – if it is returned to government following the next general election.
However, Mr O’Brien is understood to have identified an extension to the scheme as a budget priority for his department, although it is formally administered by the Department of Finance as it is a taxation measure.
The scheme offers a tax rebate to first-time buyers, worth up to €30,000.
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It is also expected that he will seek an increase to the cap on the price of homes eligible for the scheme, currently fixed at €500,000, in October’s budget.
A source said the goal would be to introduce regional variations on the cap, which has been in place since 2016, in recognition of price differences in different parts of the country.
In a pre-budget submission, estate agent Savills called for the threshold to be raised from €500,000 to €614,000 for homes in Dublin, citing increases in construction costs and consumer inflation since it was initiated. The estate agent also called for the scheme to run until December 2028.
Housing is expected to be a central issue in the election campaign – now expected to kick off in earnest once the summer break is concluded and speculation mounts about an autumn contest.
Sinn Féin is set to unveil its full housing strategy in early September. In its affordable housing plan published last week, the party pledged to deliver 50,000 affordable rental and purchase properties. Rents would be €1,000 per month while affordable purchase units would come in at no more than €300,000.
A higher grant for refurbishing derelict properties is also expected to be on Mr O’Brien’s budget wish list – and if not included in October, it is likely to feature in Fianna Fáil’s general election manifesto. Those buying a vacant home can avail of grants of up to €50,000 to invest in the property - or €70,000 if it is certified as derelict.
It is understood that an unpublished review of the scheme has recommended that the higher limit for derelict homes should rise to €80,000. A further increase in the renters’ tax credit – currently set at €750 – is also on the cards, with one source saying the goal would be to hike that to at least €1,000.
With the Cabinet not set to meet until September and the Dáil in its summer recess, Ministers are working on their budget asks over the break.
Minister for Enterprise Peter Burke is expected to seek an increase in the R&D tax credit and an extension of existing schemes, while both Fianna Fáil and Fine Gael have targeted an overhaul of inheritance tax, pushing for the threshold over which 33 per cent capital acquisitions tax (CAT) must be paid to increase by up to €65,000. Currently the tax is levied on inheritances over €335,000.
A range of once-off payments are expected, including double child benefit and various disability and age-related benefits, while revisions to the universal social charge are also being considered. Another round of electricity credits has been mooted, as has a VAT cut to broadband bills.
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