The Help to Buy scheme has been welcomed by the CIF but warned it will not address the affordability gap that faces the average couple together with rising construction costs. Director of the Irish Home Builders Association, James Benson, said: “Our analysis shows that average couple, even with the Help to Buy, will struggle to save the required deposit. Couples earning under €93,000 are effectively frozen out of the Dublin housing market; even with the HTB they will have to save €20,000 approximately as a deposit. At current rent levels, this savings level is beyond most couples. A recent EY survey showed that the average couple in Dublin would have to save for 4.5 years, and up to 15 years plus Meath, Kildare and Wicklow. These couples are consigned to rental purgatory for the foreseeable future.
“The Help to Buy, whilst helpful, on its own doesn’t address affordability issues or rising construction costs. We must address the cost of homebuilding where soft costs ie taxation, levies, finance and fees equate to over 30% approximately of the price of new homes. An increase in stamp duty announced today will mean a further land transaction fee adding to overall costs and potentially affecting viability of marginal projects.
“Many housebuilders have reported that up to 80% of homes sold to first time buyers they are currently enabled by the Help to Buy Scheme. The measure is considered the most effective intervention by Government by Irish housebuilders in terms of enabling housing supply. However, it alone will not suffice in generating the 25,000-unit annual output envisaged in Rebuilding Ireland or the Government’s 2024 target of 45,000 units per annum.”
Editor of Irish Construction Industry Magazine