The Irish Home Builders Association has called for urgent, targeted action to be taken in Budget 2021 to address the challenges of affordability and supply of new homes.
The IHBA represents hundreds of home builders of all sizes across Ireland.
James Benson, spokesperson for the IHBA, said that the delivery of homes is well behind where it needs to be.
"We need to see on average 36,000 homes built every year for the next twenty years across all tenure types from social, private and rental. A survey of IHBA members, who build 85% of private homes in Ireland, suggests that the Covid-19 pandemic has increased the delivery time of homes and added to existing uncertainty in the market," he said.
According to Mr Benson, they have seen a "noticeable" drop in commencements which will gravely impact supply in the next 18 months.
"Members are reporting a 26% drop in planned developments this year and a further 13% drop for 2021. Budget 2021 provides the Government with an opportunity to introduce measures that will accelerate the delivery of new homes," he said.
In its pre-Budget submission, the IHBA has identified three measures to address the issue of affordability.
It said a shared equity scheme would enable consumers on a combined income of €70,000 to access the market. It said the scheme would be a loan, self-funding over time and capped based on dwelling type and location.
In the submission it has called for a commitment to continue the Help to Buy Scheme, which will help hopeful buyers secure the required deposit to obtain their residential mortgage and assist the rate of commencement of new homes. In the twelve months to the end of March 2020, it said 78% of first-time buyers used the Help to Buy Scheme.
The IHBA has also called for an increase in the Rebuilding Ireland Home Loan cap to match the caps of the Shared Equity Scheme. It said doubling current funding would provide opportunities for hard-pressed first-time buyers. The Rebuilding Ireland Home Loan is a Government backed mortgage for first time buyers who cannot source housing loans from the private funding institutions.
The IHBA also identified measures to address the issue of supply.
It has called for an extension of the Home Building Finance Ireland 'Momentum Fund' beyond Covid-19 until the end of 2021 as a minimum and has called for greater access to development finance at rates competitive with the pillar banks. The HBFI Momentum Fund is designed to ensure that new large-scale residential projects continue to be commenced and delivered post Covid-19.
The IHBA also wants to align taxation of private landlords with corporate landlords to create an incentive for private investors to come back into the market.
A survey of IHBA members has outlined the impacts of Covid-19 on the delivery of new homes and how measures in Budget 2021 can accelerate this delivery.
"This latest survey shows that if appropriate measures are introduced in Budget 2021 our members can deliver an additional 9,000 homes across a number of tenure types to the Irish market. Those additional homes alone would provide 1.04bn in revenues for the State" James Benson said.
