Fingal County Council is planning to develop housing at Donabate. The Council has issued a “market sounding” document on etenders.gov.ie, which refers to a mixture of private houses for sale at market prices, “affordable” private houses to be sold at a discount to market rates, and social houses. I have asked them to look into developing cost rental housing for the following reasons:
- Cost rental provides secure affordable accommodation to the large segment of the population who do not qualify for social housing but are unable to secure a mortgage to buy.
- Cost rental housing remains permanently affordable, unlike “affordable” housing which may only be affordable once, as it will in time be sold on at a market rent.
- Because the costs of development are fully recovered the capital can be reused for further cost rental housing development.
- Cost rental will facilitate social mix because HAP can be applied to make up the rent for lower income tenants.
- In cities where it has been provided in quantity, cost rental has a moderating effect on rents.
My full letter and attachments are below:
A chairde,
Thank you for sending on this paper. There is a housing approach which has been omitted from the sounding paper – provision of public housing on a cost rental basis.
The Oireachtas approved the attached motion on 6th March. The Minister for Housing Planning and Local Government said in April that cost rental was a “key part of the Government’s Housing Strategy”.
There are some significant advantages to making housing affordable by means of a cost rental system as opposed to by the provision of a discount on the sale of houses:
- Cost rental provides secure affordable accommodation to the large segment of the population who do not qualify for social housing but are unable to secure a mortgage to buy.
- Cost rental housing remains permanently affordable, unlike “affordable” housing which may only be affordable once, as it will in time be sold on at a market rent.
- Because the costs of development are fully recovered the capital can be reused for further cost rental housing development.
- Cost rental will facilitate social mix because HAP can be applied to make up the rent for lower income tenants.
- In cities where it has been provided in quantity, cost rental has a moderating effect on rents.
This should be a key part, or indeed the dominant element, of the new housing development at Ballymastone. Can the practicalities be investigated either through, or in addition to, the market sounding?
Attachments:
Oireachtas Cost Rental Housing Motion 6th March 2018
“Cost_rental_housing:_a_model_for_Ireland”, Paul Goldrick-Kelly, NERI Research Institute, May 2018