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Help-to-Buy scheme is extended to boost affordable housing

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The Help-to-Buy scheme is key to having more new homes built

The Help-to-Buy scheme is key to having more new homes built

PA

The Help-to-Buy scheme is key to having more new homes built

The Budget measure most vital for maintaining a flow of new homes to an undersupplied market, is yesterday's extension of the Help-to-Buy scheme until December 2021.

Help-to-Buy has been the single most-effective aspect of Government policy deployed since the start of the housing crisis and in its most recent form, allows first-time buyers to claw back 10pc of the value of a new home priced under €500,000, to a limit of €30,000.

When it was introduced in 2014, many sites were not commercially viable and developers struggled to get finance. Help-To-Buy finally got the construction industry moving as new homes were built in numbers.

Benefits

By last year, annual new home completions had surged to over 21,000, with obvious benefits across the board. This year's tally has been impacted by Covid, but builders are still likely to complete a respectable 18,000 homes by year's end.

Much of this would not be possible without Help-to-Buy.

However, last night, industry sources expressed some surprise that the scheme is only being pushed out for another year and not for two, especially given the time cycle of development from green field through planning to completed scheme.

A one-year extension will be of benefit, but not so much to schemes that are very early in incubation. Also vital for increasing the amount of new homes built are various measures aimed at making sites more usable and fit for development, including a spend of €1.26bn for the Land Development Agency, whose job is to source land for home building going forward.

An additional €90m is being specifically allocated to water and sewerage infrastructure, which should also help prepare land for housing.

The Stamp Duty Residential Development Refund Scheme, which was due to expire on December 31, 2021 will be extended to operations begun by December 31, 2022.

This scheme allows builders to benefit from a refund on commercial use land, which ends up being channelled into residential development instead.

In addition, the time allowed between commencement and completion of a qualifying project is being extended to two-and-a-half years.

All of the above helps the construction sector in its task of providing new homes going forward. Also on the Budget menu, but in a more reduced capacity, were moves to boost social housing and to help with homelessness.

There has been a general welcome for the substantial €773m annual increase in the allocation to the Department of Housing.

This will help provide 12,750 new social households next year through the construction of dedicated social housing units and also through lease and acquisition of other properties.

Minister McGrath announced 9,500 dedicated social housing units will be constructed in 2021. This marks an increase of 593 on the existing target for 2021 under Rebuilding Ireland.

On top of this, €110m has been earmarked to provide affordable housing and cost rental schemes.

A €65m allocation to help with 'deep retrofitting' of current social housing stock, along with funds for an additional 15,000 Housing Assistance Payment (HAP) scheme tenancies in the private rental sector were also announced.

Meanwhile, workers can now count broadband as a tax-deductible utility for operating from home.

The Budget move comes just in time for the first tranche of 7,900 rural homes and businesses that are to receive their first access to high-speed broadband under the State-subsidised National Broadband Plan by the end of December.

Next year, that figure will jump to 122,000 rural homes and businesses.

However, the move may also recognise something more seismic - we may be in the middle of a permanent transition to home working, beyond the end of the current Covid crisis.