Homeowners spend €1.2bn over four years renovating homes
Almost 77,000 projects completed under incentive scheme, at average cost of €16,000
Dublin has accounted for almost half of all projects undertaken and more than half of the total cost of the Home Renovation Incentive since it was launched in 2013. Photograph: Frank Miller
Homeowners have spent €1.23 billion improving and renovating their homes over the past four years, according to figures published on Monday.
The incentive allows property owners a tax credit on 13.5 per cent of qualifying expenditure on home improvements, if carried out by a qualified contractor – ie one who is registered with the Revenue and tax compliant.
CIF figures show that almost 77,000 projects have been completed under the scheme, at an average cost of €15,965.
Dublin has accounted for almost half of all projects undertaken and more than half of the total cost. However, the highest average spend per project was in Donegal, where property owners invested an average of €18,596 per renovation project. Clare ranked third behind the capital in cost per project at €17,138.
Roscommon had the most modest spend, at €10,429 per project, just below Carlow (€10,758) and Longford (€11,295).
In overall terms, the smallest number of projects was carried out in Leitrim (232), just behind Monaghan (271) and Longford (301).
Outside of Dublin and Cork which, as expected, accounted for the largest number of applications under the scheme, Kildare was the most active county, ahead of Galway, Wicklow, Meath and Limerick.
As not all work undertaken will fall under the qualifying criteria, and some is already zero-rated for VAT, the cost to the exchequer of the scheme to the end of last year has been €85.3 million.
The CIF says this exchequer spending “supports over €10 billion spend in the economy since 2014”.
“The Home Renovation Incentive has been very successful on several fronts,” said CIF director general Tom Parlon. “It supported an incredible €4 billion spending into the Irish economy in 2016. This money is recycled into the local community by the 9,000-plus contractors involved.”
The repair, maintenance and improvement sector of the construction industry now accounts for more than 26 per cent of the total value of construction activity in Ireland. That’s is down from 34.5 per cent in 2014, the first full year of the Home Renovation Incentive as the economy has improved.
Apart from residential renovations, these firms also engage in civil engineering and office remedial work.
Mr Parlon said it was likely that the incentive had kept many thousands of workers and companies afloat during the recession. He said it also helped Ireland work towards its climate change targets as much renovation work was designed to make homes more energy efficient.
The Home Renovation Incentive was first introduced in October 2013 and was due to expire at the end of 2016. However, it has since been extended to the end of 2018.
Originally targeted only at homeowners, it has since been extended to include rented property. The credit is applied by Revenue over the two tax years after the project is complete.