Government examining off-balance sheet option for housing

The Government is examining a scheme to buy social housing that will keep the cost off the State’s balance sheet.

Legislators have been debating since the formation of the Government as to how the State might solve the housing crisis without breaching EU fiscal rules.

Social Justice Ireland policy analyst Michelle Murphy told the Oireachtas Committee on Housing and Homelessness last month that €10 billion was required to clear the waiting list and that it would not be possible for the exchequer to provide funding on that scale.

She added that one possibility would be to use a vehicle such as Nama to develop a mechanism that meets the Eurostat conditions for an acceptable off-balance sheet initiative.

Speaking at the launch of Nama’s 2015 annual report on Wednesday, Minister for Finance Michael Noonan said the agency had set up a subsidiary called Nama Asset Residential Property Services (Narps) to purchase houses from developers to lease them to local authorities.

‘Short of resources’

“Local authorities, like every other State group over the last few years, have been short of resources, and the fact that they could lease rather than purchase from Nama was very significant,” he said.

“The Housing Minister has to examine a range of options to deal with a lack of supply, which everybody agrees now is the primary problem in providing both social housing and private affordable housing in our cities and particularly in Dublin.

“This is something working successfully for Nama. It’s one of the things we’re looking at, but of course there are a whole range of options. Its attractiveness is that we’re always, as a country, short of capital or investment.

“The Narps initiative keeps the leasing off balance sheet, so a model which would increase the supply of housing in a manner where it didn’t impact on the public capital programme is always worth looking at.”