Local authorities ‘will significantly increase building delivery’
Waterford’s Michael Walsh says all councils will ‘ramp up’ social housing building
Minister for Housing Eoghan Murphy has unveiled a new scheme of local authority mortgages that will be available from next week. File photograph: Chris Ratcliffe/Bloomberg
A representative from the City and County Managers Association has said that local authorities have the staff and facilities to administer the new government backed mortgage scheme.
Michael Walsh is also adamant that local authorities will soon return to pre-Recession levels of building 4,000 to 5,000 social houses.
Mr Walsh is also the chief executive of Waterford City and County Council.
“We will significantly increase our building delivery. We are ramping up,” he told RTE’s Morning Ireland.
Minister for Housing Eoghan Murphy has unveiled a new scheme of local authority mortgages that will be available from next week. Under the scheme, the Government will finance local authorities to provide mortgages to people who have been turned down by banks.
Mr Walsh said that in 2017 local authorities, in conjunction with approved housing bodies, delivered 2,400 social houses. He anticipates a 50 per cent increase this year with a further increase of 50 per cent next year.
“For ten years there was no housing construction. Now we are ramping up. It started from zero. We’ll get back to 3,000 to 4,000 per year and then we’ll hit 4,000 to 6,000 per year.”
Issues such as land availability, political acceptance, procurement and processing have slowed the process in the past, but Mr Walsh was adamant that all local authorities would be “ramping up and improving”.
“We (Waterford) will deliver our targets,” he added.
Repair and lease scheme
The low-interest rate mortgages will be available to purchasers of properties worth up to €320,000 in the greater Dublin area, Cork and Galway, while the ceiling in the rest of the country will be €250,000.
The scheme will be reserved for borrowers with an annual gross income of no more than €50,000, or €75,000 for couples. Central Bank rules will apply so borrowers will be able to take a mortgage for 90 per cent of the property’s value. Borrowers will be able to choose a fixed rate of 2-2.25 per cent over 25-30 years, terms unavailable from any bank.
Local authorities cover a whole host of areas when it comes to providing social housing, Mr Walsh said.
In Waterford a repair and lease scheme had delivered 40-50 units. This was where vacant and semi derelict properties were refurbished and brought back into active use, he explained.
Local authorities are now focused on delivering social houses. “We are putting our absolute concentration into delivering new homes for our tenants.”
Mr Walsh said that local authorities have sufficient administrative staff to cope with applicants for the new mortgage scheme.
“There is no need for extra staff. The 1,000 mortgages can be dealt with in the next few months, then the Minister can see what impact this has had on the market.”
He pointed out that the scheme is similar to housing loans already being offered by local authorities.
He acknowledged that there were some issues with arrears, but maintained that local authorities are managing the issue through “a whole host of mechanisms.”
The new mortgage scheme is a significant addition to the suite of services offered by local authorities, said Mr Walsh.