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Updated 2.20pm
MINISTER FOR FINANCE Paschal Donohoe has announced a string of new measures in Budget 2018 that he said he will help to alleviate the housing crisis in this country.
“Housing remains a crucial priority for this government,” he said. “I am very aware of the corrosive impact of homelessness on those in our society.”
He pledged almost €2 billion for housing next year, broken down into increases to the Housing Assistance Payment (Hap) scheme and funding for direct builds of new social houses.
Some of these initiatives will not kick in until 2019.
Donohoe explained: “An increase of €31 million has been allocated to the Social Housing Current Expenditure Programme bringing the total to €115 million. This will deliver an extra 4,000 social housing homes next year.
In addition to the substantial extra resources that I have provided for housing in 2018, I am today also announcing an additional commitment to further accelerate the delivery of social housing from 2019.
“I am providing an extra €500 million for the direct building programme which will see an additional 3,000 new build social houses by 2021, increasing the existing Rebuilding Ireland target of social housing homes to 50,000, of which 33,500 will be delivered through construction.”
Vacant sites
The Finance Minister also had some tough talk for so-called land hoarders who have been apportioned blame for the current housing crisis.
“The message to vacant site owners is clear… you need to get on to developing your lands urgently,” he said when announcing harsher penalties.
He said that the vacant site levy will more than double from 3% to 7% on land not sold by 2019.
What this means in practical terms is that any owner of a vacant site on the register who does not develop their land in 2018 will pay the 3% levy in 2019 and then become liable to the increased rate of 7% from 1 January 2020. If they continue to hoard their land in 2019, they will pay 7% in 2020, resulting in an effective vacant site levy of 10 per cent over the two years.
The Minister also outlined the tapering off of mortgage interest relief. From next year, it will be reduced to 75% of current relief and will eventually fall to 25% in 2020.
Mortgage interest relief is a tax relief based on the amount of interest paid in a tax year on a qualifying mortgage loan. (Basically, you can claim tax back on mortgage interest payments). It was initially put in place to help those in negative equity following the bust. Fianna Fáil had wanted to retain the full relief but had conceded to the cuts during negotiations.
Donohoe said the government was reducing the seven-year period owners must retain qualifying assets to enjoy full relief from capital gains tax to four years.
Here are the measures outlined by Donohoe in housing:
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Does being on the housing list cover those of us wanting to buy but can’t afford deposits because of crippling rent and over inflated house prices???
@Rob Cahill: one word answer: no.
@Rob Cahill: Nope, if you want to pay your own way in life, you get absolutely no help whatsoever.
@Ronan Sexton: Well, to be fair, then it wouldn’t be called “Paying your own way” would it?!
@David Ronan: You don’t get help with housing because you don’t need it as bad.
You get plenty of help from other public services when working full time. Medical cards, free tuition fees at school and college (and in the case of fee paying schools MUCH lower fees than they would be if it was a private school.) , children’s allowance…
@Ryan Carroll: Children allowance is for everyone so that not sure you point there.
I’m working full time – I don’t qualify for medical card, I have to pay for my son college, I do use Catholic schools but am expected to contribute each year.
A person can be working and still homeless in this country. Saying you don’t need help with housing because you work is incorrect. Lots of people working can’t save enough for deposit or afford the current house prices.
So as David said no help for those that work
@Ronan Sexton: The wealthy get the middleclass to attack the poor. your a classic case.
This budget could have been written in a South Dublin golf club, or in the Shelbourne Hotel after one of the rugger internationals. Actually it probably was.
List or not, all you will get are higher house prices from this budget, good luck.
Obviously they are planning for more homelessness to happen.
The budget to cater for the problem has been massivily increased. If you are on the threshold of losing your home or afraid of a rent increase be afraid,very afraid.
New quangos are being established to build houses, but these will be well out of the reach of the ordinary wage earner, paltry sums for social housing, which will take years anyway. The future scares me.
“The Minister also announced a 7% vacant property tax which he said would encourage landowners to put properties back into use for housing.”
Does that include all the bordered up houses belonging to NAMA and local councils?
So if you have a house – you want to wait for the value to increase and you don’t want to rent because of the rules and nightmare of renting – you now will be punished.
I hope someone challenges that in the court of law.
@B9xiRspG: The 3-7% vacant site levy is for land and not for properties . To be marked as a vacant site it states…. any land over half a hectare that does not have a private dwelling and has been vacant for the previous 12 months will be considered for the public register.
The centre of the world!! WHO do we think we are¿!
When exactly will the first cut to Mortgage Interest relief kick in?
@Neal Ireland Hello.: Perhaps we’ll
never know!
Agreed, we have a serious housing problem, How did this situation arise since its unlikely that the Irish Population has suddenly increased to a great extent.
@Joe Keena: i have been pondering that very thing for two years now where have they all come from?
@Joe Keena: from experience of been homeless myself and my husband and and 3kids. At least 60 to 70℅ are foreign national. The rest are Irish. And all got looked after before Irish what ever pull they have
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