No guarantee publicly-funded ‘affordable’ housing will be affordable

Homes in one of State’s biggest private developments may cost €300,000

The Local Infrastructure Housing Activation Fund  is designed to help pay for infrastructure to enable development of sites

The Local Infrastructure Housing Activation Fund is designed to help pay for infrastructure to enable development of sites

 

There is no guarantee publicly-funded “affordable” housing will be affordable, a senior Department of Housing official has said.

David Walsh, assistant secretary at the department, told the Oireachtas Housing Committee on Tuesday it was possible none of the homes in one of the biggest private housing developments in the State would be available for less than €300,000. This is despite the development getting a State subsidy of €15.2 million under the condition that affordable housing be provided.

The development of up to 8,000 housing units at Cherrywood in Dún Laoghaire-Rathdown County Council area qualifies for the public money under the Local Infrastructure Housing Activation Fund (LIHAF).

Introduced last year as part of the Government’s Rebuilding Ireland plan, the €200 million fund is designed to help pay for infrastructure to enable development of sites. The Cherrywood site is one of 12 in the greater Dublin area in receipt of money from the fund. It will be used for road upgrades and bridges .

Under the terms of the fund, as outlined in a department circular to local authorities in August last year, a commitment was to come from “those housing providers to produce housing quickly, at scale and at affordable prices”.

“The department is determined that the €200 million infrastructure fund will, in addition to stimulating supply in an overall sense, also encourages a strong mix of private, rental and social housing delivery at appropriate locations, and create attractive places to live at affordable prices and rents,” says the circular.

Difficulty

Mr Walsh said there was a difficulty in deciding what level of affordability would be deliverable. It depended on the level of LIHAF funding a developer got, how many units they provided and their location.

“So the issue is around relative affordability, what price it would have been and what can be delivered...The dividend from the LIHAF, it really depends on what will be the output and the price in the lands that are opened up, and what will be facilitated through the local authority.”

Sinn Féin Eoin O Broin asked him: “On the basis of what you’ve said, you could have, for example, Cherrywood and an allocation there of €15 million, and no houses would come in there under €300,000. That is essentially what you’re saying? That is now possible?”

Mr Walsh answered: “It is possible but we won’t know until we see what the local authority and the developers come in with. It is primarily an agreement between the local authority and the developer and the landowners.”

Conditionality

Independent Senator Victor Boyhan said there “must be some conditionality around affordability”.The public would be “rightly angry, outraged” if they thought there was not any oversight on the issue from Minister for Housing Eoghan Murphy.

“Substantial public money is going into LIHAF...Surely there is going to have to be conditionality around affordability...[and criteria around] allowing public money to assist private developments with infrastructure to land where it was always intended they would deliver units affordable and social,” said Mr Boyhan.