Rental Strategy Leaves Low-to-Moderate Income Earners Out In The Cold

Three national housing associations have come together to call on the Housing Minister Simon Coveney T.D. to deliver on his promise to establish a pilot affordable rental scheme.   The associations welcome much of the government’s rental strategy and in particular the plan to reduce rent increases in the private rented sector; to increase security of tenure; and to introduce higher minimum standards in rental accommodation.  However, they say that it has failed to deliver on a scheme that could provide long-term affordable housing for thousands of households who are currently living in unaffordable housing.  These households, the ‘squeezed middle’, are struggling to afford very high private rents, cannot access social housing and are limited in their ability to secure mortgages by the amount they are forced to spend on rent.

The scheme, called affordable rental housing, is aimed at low-to-moderate income households who have difficulty paying private rents but are generally not eligible for social housing.  It has been discussed for over two years, and a pilot was promised in the government’s action plan Rebuilding Ireland, published in July this year.  However the government’s rental strategy, published this morning, proposes to establish an expert working group which won’t report until the end of 2017.

The housing associations: Clúid Housing, Co-operative Housing Ireland, and Oaklee Housing, provide between them social rented housing to over 8,400 households.

“We strongly support affordable rental housing, which targets a group of people who simply cannot afford to sustain current private sector rents,” said Kieron Brennan, CEO, Co-operative Housing Ireland.  “These households are either excluded from the rental market or paying more than 30% of their net income on rent, which is the widely accepted affordability threshold.  Many are young working people who have a vital role to play in Ireland’s economic recovery.”

Tenants in affordable rental housing would pay less than the market rent, so affordable rental housing can only be done with a government subsidy.  But the subsidy needed is much lower than the subsidy required for social housing.

Sharon Cosgrove, CEO of Oaklee Housing said, “We believe that housing associations are best placed to deliver affordable rental housing because a once-off long-term loan will enable them to provide affordable rental housing in perpetuity without any further government subsidy.”

“We are very disappointed that this scheme appears to have been put on the long finger,” said Simon Brooke, Head of Policy at Clúid Housing.  “We are calling on Housing Minister Simon Coveney T.D. to deliver on the promise in the government’s action plan, Rebuilding Ireland and establish a pilot affordable rental scheme as soon as possible.  It would not require legislation and a viable framework could be agreed very quickly.  This scheme has been discussed for over two years.  Now is the time to bite the bullet.”

 

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