Budget a lost opportunity says CIF
Speaking to RTE in the immediate aftermath of the Budget announcement, CIF Director General Tom Parlon said that although there was a “wide appreciation” of problems facing the house-building sector, the new budget had “plastered over the issues”.
“We needed something aggressive but that hasn’t transpired yet,” he said.
“It’s too big an issue to ignore,” he added.
The CIF had been hoping for a reduction in VAT and developer levies, amongst other items on its pre-Budget wish list.
In the one major construction-related announcement, Minister for Finance Michael Noonan, said Nama will build 20,000 homes by 2020.
“It is clear that there is a market failure in the provision of new housing across the country but particularly in Dublin,” said the minister.
“Driven by demographic demands and strong economic growth, there is a requirement for a minimum of 10,000 new units per annum in the Dublin area but the market only delivered 3,300 units in the last year.
“Nama is aiming to deliver a target of 20,000 residential units before the end of 2020. 90 per cent of these units will be in the greater Dublin area. About 75 per cent of these units will be houses, mainly starter homes. Nama will deliver these units by working with developers.
“Achieving this new target by the end of 2020 means delivering on average 80 new housing units every week across some 100 active sites.
“This commitment will require funding of the order of €4.5 billion, which will all be recovered, and will support 30,000 house building and ancillary jobs based on peak funding.”
According to Tom Parlon a Dublin-based couple with a combined salary of €80,000 will remain unable to purchase a home.
“While we welcome the provisions that Nama can provide 20,000 houses between now and 2020, this will only deliver to 4,000 units per annum, which equates to only 25% of broadly acknowledged annual national demand,” he said.
“There are no proposals to address the issue of costs of providing new homes, the availability of affordable development finance, or the availability of mortgages. We are concerned that this may be a lost opportunity to support the construction of much needed additional homes to meet sustainable demand.”
In further reaction Threshold, the national housing charity, has strongly criticised this year’s budget for failing to introduce rent certainty measures to help address the current homelessness crisis.
Commenting today, Senator Aideen Hayden, Chair of Threshold said: “Today’s budget did not contain promised housing measures that Threshold had called for in its pre-budget submission. While we understand that talks are ongoing between the Department of the Environment and Department of Finance, we are very concerned that without the immediate introduction of rent certainty measures, an additional 700 families may become homeless between now and Christmas due to excessive rent increases”.