The Minister for Finance has announced a €2.3bn allocation for housing programmes in 2019. Paschal Donohoe said it represented an increase of €470m, or 26%, on this year. €1.25bn will be allocated to the delivery of 10,000 new social housing units.
The minister said more houses would be provided this year than in any year in the past decade. An extra €121m is being directed towards the Housing Assistance Programme (HAP). €60 million extra is being allocated in capital funding this year, the bulk of it towards the provision of emergency accommodation. An additional €30m is being provided for homeless services bringing the total allocation to €146m for 2019.
The Minister said he intended to increase the Serviced Sites Fund from €100 million to €310m over three years. The intention of the fund is to support local authorities in identifying and providing lands for subsidised, affordable housing. Paschal Donohoe said it would facilitate the delivery of 6,000 affordable homes over the fund’s lifetime.
For landlords, the Minister announced that he was increasing the threshold on mortgage interest that’s tax deductible from 85% at present to 100%. The allocation towards housing was welcomed by the Construction Industry Federation.
However, the CIF said it was disappointed at what it said was an absence of clarity in relation to an extension of the Help to Buy scheme which is due to expire in December 2019. “This will create uncertainty next year for both first-time house buyers and homebuilders,” the CIF said in a statement. “The Help to Buy Scheme has significantly contributed to a 30% year on year increase in housing output since its introduction. This measure essentially resulted in making it financially viable to build starter homes again and freed up finance from banks for this segment.”