The not-for-profit approved housing body iCare aims to have 1,000 tenants within the next 18 months.
The organisation intends to achieve this target by buying homes from lenders under a mortgage-to-rent scheme as well as empty houses around the State that are suitable for social housing, according to founder David Hall.
In an interview with the Inside Business podcast from The Irish Times, Mr Hall said that iCare, which was established last September, will receive an initial €15 million in funding from AIB in the middle of the next month as it prepares to take ownership of an initial 99 homes. The Department of Housing will also provide subordinated debt equating to part fund property purchases.
Half of the initial batch of houses iCare is taking over are coming from distressed AIB customers who are eligible for social housing and willing to participate in the mortgage-to-rent plan. The remainder will come from a variety of mainstream banks and overseas funds that have bought Irish loans in recent years.
Mr Hall expects that iCare will build up a stock of 500 such homes over the next 18 months.
Debt written off
“These will be people who will stay in their homes [as tenants], have their debt written off and the option to buy back the home at a price we paid for it,” said Mr Hall. He added that the local authority will pay 92 per cent of the market rent and the tenant will pay the remainder.
In addition, Mr Hall said iCare plans to buy empty homes countrywide later this year that would be suitable for social housing. He said iCare could “probably buy 500 of those” over the next 18 months.
The organisation has been established under an improved mortgage-to-rent regime in Ireland, after an initial scheme set up by the Government in 2012 had limited take up.
Earlier this month, the Government authorised another operator, Home for Life, backed by property developers Charles O'Reilly Hyland and businessman Paul Cunningham, which is initially targeting up to 500 homes owned by troubled Permanent TSB borrowers.