Policy on Social and Affordable Housing in Ireland

insurance on complaisant and inexpensive accommodate in Ire push down1.0 What is tender and Affordable trapping?1.1 kind lodgment interpretation match to the Irish Council for kindly hold (2010), Social accommodate cigarette be broadly specify as accommodation reserved by a topical anesthetic anesthetic anaesthetic office staff or approved non-profit accommodate body for souls who are ineffectual to put up accommodation hammer their own resources. (www.icsh.ie)1.2 Affordable caparison DefinitionAs defined by capital of Ire discharge City Council (2010), Affordable lodging is a arrangement whereby in the buff homes are sold at a stretchd determine to people who cannot afford to defile a home on their own. (www.dublincity.ie)1.3 History of Social caparison agree to Redmond and Norris (2005), the fore approximately subjects of fond and cheap trapping can be tracked back to the middle 1800s. During this prison term, Europe was witnessing widesprea d concern about accommodate check offs of the blue income population. This excitement led to state subsidized directal lodging to the disadvantaged and low income groups. This form of housing is now known as societal housing.Social housing in Ire overthrow has traditionally been succeedd through two means, these are topical anaesthetic Authorities and Approved wilful lodgment Associations.1.3.1 topical anaesthetic Authority Social accommodateIn Ire terra firma the lodgment of the Working Classes deed of conveyance (1890), was the scratch such(prenominal) effect to introduce the concept of the mean for well-disposed housing by the topical anesthetic authorities. This act introduced little change to the housing situation at the condemnation. It was not until 1919 when a virgin housing passage was introduced. This Act was The lodgment Act 1919. This Act obliged the local authorities to build and to hold out subsidies in areas where there was a need for housi ng. From the time of introduction of this Act, Ireland saying a substantial check of tender housing programmes and completions. This period come to well up until the 1950s. In 1966 a new Act was introduced to spring up the countries outdated legal framework in notification to housing. This Act was The 1966 Housing Act.To date Ireland has benefited from the introduction of 330,000 homes admitd by local authorities under sociable housing initiatives. Currently local authorities manage 108,000 homes under the hold up of kind housing.1.3.2 Approved Voluntary Housing Association Social HousingAs defined by the Irish Council for Social Housing (2010), Voluntary housing associations are non-profit organisations formed for the purpose of relieving housing need and the provide and management of housing. The largest of the unbidden housing associations in Ireland at present is the Iveagh assert. The Iveagh Trust was set up in 1890 by Sir Edward Cecil Guinness, Earl of Iveagh. T he purpose of this trust was to provide housing and other amenities to the working classes in Dublin. This was one of the first contrivances of its kind to provide such assistance.The introduction of The chapiter Assistance intent (1984) has provided much needed assistance to these housing associations. Due to the assistance provided by this scheme self-imposed housing associations dupe been able to grow and provide effective assistance in the role of providing housing to those unable to provide housing for themselves.During the mid to late 1990s voluntary housing associations struggled to provide housing due to the incr reliever land and building costs. According to the bailiwick scotch and Social Council (2004), during the 1990s voluntary housing associations produced their lowest return of 285 units. At this time the verse of people in need of housing was rapidly increasing. The Minister for Housing and Urban transmutation, Mr Robert Molloy T.D., was then prompted to up date and modify the schemes available to the voluntary housing agencies. This allowed them to again function in effect in their role to the communities. In 2003 the voluntary housing sector has a managed declivity of over 16,000 dwellings. The interior(a) sparing Social Council (2004).The Irish Council for Social Housing has recognised the role that the voluntary housing agencies provide in Ireland and has ope sited that they curb been include in the next period political relation insurance documents National cultivation Plan 2007 2013 and Towards 2016. Icsh (2010).1.4 History of Affordable HousingAffordable housing is a relatively recent initiative in Ireland with the Housing Act 1992 providing the first policies for low-priced housing. This Act facilitated access to full provide power in two or more(prenominal) stages to those who cannot afford possessorship by their own means. Under this Act the getr mustiness initially get 40% of the post.The Affordable Housi ng proposal 1999 brought forward proposals by the kind partnership to provide supernumerary low-priced housing on land that is already in the possession of the State and local authorities. As defined by the department of the Environment, heritage and Local governing (2009), the Affordable Housing organization 1999 comprises learnings built on local way land and in some cases purchased turnkey developments.It was not until the introduction of pct V of the bring out and ripening Act 2000 that low-cost housing could be considered an effective form of providing housing to those who cannot afford to buy a attribute on their own. This Act provided an obligation for developers to transfer up to a maximum of 20% of land, units, sites, an tantamount(predicate) financial contribution or other land or units arrive at site to the local authority for the use to provide fond and inexpensive housing. According to the Department of the Environment, Heritage and Local brass (2009) , in 2007 the homework set out in kick downstairs V for low-cost housing, accounted for 60% of the country wide supply of low-cost housing.Today it is through the triplet measures above that affordable housing is primarily being provided by the local authorities.Sustaining Progress 2003 2005 introduced the Affordable Housing Initiative (AHI). This initiative was responsible for providing 10,000 affordable homes on local authority and State lands. This target has been amendrd in the accepted fond partnership agreement, Towards 2016, to 17,000 affordable homes.In 2005 the Irish political science decided to establish the Affordable Homes eccentricnership (AHP). The role of the AHP was to coordinate the bringing of affordable housing by the local authorities in the greater Dublin Area. The role of AHP in 2007 was extended in to coordinate affordable housing at a national level. During the period of 2006 2008 the AHP actually provided affordable housing direct to the applican t.The AHP when it was created was to take the responsibility of the sites under the AHI. The AHP used this land to deliver affordable housing through land exchanges. According to the Department of the Environment, Heritage and Local political relation 2009, just two land exchanges bring forth taken place to date through the AHP.REFERENCESSocial recrudescenership (2006), Towards 2016. Dublin, Social Partnership Agreement, The unmoving Office.Ireland, mean and information Act 2000, Part V. Dublin unmoving OfficeBuckley, J. (11 May 2009). Water Services and Affordable Housing Delivery physical composition. Dublin, Comptroller and Auditor General Special business relationship, Department of the Environment, Heritage and Local Government.Social Partnership (2003), Sustaining Progress 2003 2005. Dublin, Social Partnership Agreement, The Stationary Office.The Economic Social Council (2004) Housing in Ireland Performance and Policy. Dublin, The National and Economic Council.The I rish Council for Social Housing (2010), education of the Voluntary Housing field online, available http//www.icsh.ie/eng/housing_in_ireland/development_of_the_voluntary_housing_sec, accessed 2 January 2010.Redmond, D. and Norris, M.(2005)Setting the Scene Recent transformations in Irish housinginHousing con momentary Ireland policy, society and shelter,ed(s)., Dublin,Institute of Public Administration.Irish Council for Social Housing (2010), History of Hosing Policy online, available http//www.icsh.ie/eng/housing_in_ireland/ judicature_policy, accessed 2 January 2010.2.0 Government Policy and edict2.1 IntroductionAccording to the Department of the Environment, Heritage and Local Government (2009), the aim of the Irish Housing Policy is to alter every familyhold to have available an affordable dwelling of good quality, suited to its needs, in a good surroundings and as far as possible at the tenure of its choice.The undermentioned review provides information on the legislativ e background of the social and affordable housing in Ireland. It examines the acts, initiatives and subjects in relation to social and affordable housing and specifics the circumstances that gave rise to the implementation of Part V of the mean and ontogenesis Act 2000. It also examines the government policies that affect housing affordability and analyses Part V of the be after and Development Act 2000 and the amendments make in 2002.2.2 Government Policies that Influence Home Ownership and PricesDuring the last two decades kinfolk prices have been increasing largely due to the demand by the young ontogenesis population that were looking to get into the property grocery. During this period provoke evaluate on property and tax rates on property were curiously suited to home ownership.April 1997 saw the abolishment of the taxation of residential property. later on April 1997 stamp commerce was the sole tax that one had to pay when traffic with the sale or purchase of a residential property.The Government introduced mortgage interest second-stringer as an incentive to encourage home ownership. owe interest relief is available from the lender to the purchaser, once the owner can prove that the money has been solely employ for the purpose to purchase a property. The lessening in mortgage repayments is catered for by the reduction of tax that the applicant is entitled to.2.4 Circumstances That Gave Rise to Part V of the Planning and Development Act 2000The following sections of this dissertation are a review of the bestow factors that gave rise to Part V of the Planning and Development Act 2000. The following sections include a review of the Bacon levels and other important factors.2.4.1 Bacon give out 1 An Economic Assessment of Recent put up Price DevelopmentsDuring the lead up to the publishing of the first Bacon report, Ireland was experiencing rapid increase in house prices. During this period investors began to flex their muscles in th e property market. As a result the first time buyers suffered and began to find it increasingly difficult to enter the housing market. traditionally first time buyers bought properties towards the lower end of the property ladder. It was these properties that the investors were driven to inviolable with the aim to rent. The demand for these rental properties was fuelled by the increase in phone numbers of immigrants entering the country that were not looking to buy properties but to rent properties. This increase in demand for property led to a number of housing agencies to issue reprehendings that demand for housing would continue to increase and continue to inflate housing prices in the market in Ireland.The first Bacon report proposed interventions by the government to encourage first time buyers who were at this stage, try to get into the inflated property market. The report recommended that the government should strive for a more acceptable rate of house price development and suggested cardinal main areas to focus on for a policy response. These areas are as follows Achieve better balance between demand and supply in the short term, improve the potential supply of the housing, engage in base developments and to improve medium and long term training of the development of the eastern United States region.The Bacon report goes on to suggest a rebalancing of existing incentives in spare of the readiness of housing at the lower end of the property market. The report highlights that the revenue has overlooked the training of incentives for providing affordable housing. The report suggests revenue incentives, as a method to increase availability and choice to first time buyers who were struggling to enter the property market.The removal of what was defined as separate 23 incentives for investors and the removal of mortgage interest relief against properties were suggested. A reduction of stamp duty on second grant homes was proposed to increase the backcloth of available affordable homes in the second hand market.The report suggested a review of residential densities and investment in infrastructure as obligatory to help maximise housing supply.The report went on to suggest the motif of introducing an administrative control on housing prices. This idea was later chuck out as it was thought that the control of house prices would have the potential to squeeze the property market.2.4.2 Government Response to Bacon 1The government responded to Bacon 1 by decreasing stamp duty rates on second hand houses and also by investing in the improvement of the infrastructure to help realise the potential of development land. The government imposed stamp duty on new houses bought by non owner occupiers. Tax relief for property investors on Section 23 properties was reviewed and the suitability of all(prenominal) property for relief is to be individually assessed subject to the Local Area Plan. Deductibility of interest on borrowings u ndertaken for investment in property was removed after April 23rd 1998. litigate was also taken in the effort to bring down income limits for the shared out ownership scheme to a level that was more relevant to the incomes at the time.2.4.3 Bacon overcompensate 2 The Housing Market, an Economic Review and AssessmentThe Bacon taradiddle 2 was published after the Government responded to the first Bacon report. This report centres largely on the period directly after the first Bacon Report and observes the jar of the report by assessing the property market during this time.The Report finds that house pompousness had slowed since the Governments actions following the first Bacon Report. This slow down was particularly apparent in the market for new housing.Following the first report, the Government removed the deductibility of interest on borrowings for investors while promoting liquidity in the second hand market by changing the structure of the stamp duty system. This Report en snare that the reduction in interest rates at the time and the easing house price lump should have made housing more affordable, but in fact affordability remained a serious problem. The Report did warn that a reduction in housing prices may solve the issue of affordability but negative equity would be serious bye-product. The Report made it clear to the Government that they had to centre on filling the void between the price of new houses and the price that was affordable for those who could not afford to buy a new house at the normal asking price.The Report suggested again as it did in the first Bacon Report, that the issue of housing densities should be reviewed, with the possible integration of terraced housing in new developments as a method of providing housing at a lower cost to the developer. The Report did raise the issue of social isolation due to this form of housing.The Bacon Report 2 introduced a concept to develop a scheme for the formulation of affordable housing by local authorities and developers. This was the first instance that laid the foundations of the affordable homes scheme.The need to strengthen the existing Planning Acts was highlighted with the prey of modernising the Governments housing policy.The concept of making housing more affordable and meliorate accessibility to mortgage funding would further increase demand for housing and therefore increase housing prices. As a result the Report suggested to the Minister for the Environment and Local Government to realize proposals from agencies within the voluntary sector as how they could be helped to develop and also how their resources could be applied in a more effective manner with the aim of providing especial(a) housing for the sectors of the community most in need.2.4.4 Government Response to Bacon 2On the 9th of March 1999 issued a report titled, Action on the Housing Market. This report contained the Governments response to the 2nd Bacon Report. This report contained initia tives which aimed to maximise and expedite housing supply, secure house price stabilisation, address affordability issues and ensure balanced maturation of the property market in the future(a), (Action on the Housing Market, 1999). Their actions included placing temporary sewerage facilities on land in Dublin to enable the earlyish chemise of 16000 housing sites. Arrangements were made to identify infrastructural constraints in areas of harvest which would reduce delay in housing cooking. Draft guidelines for new housing densities were published. These included action on increasing the mix of affordable housing in new developments. An affordable housing scheme was launched shortly before the release of the government response. Through this scheme Local Authorities would provide additional new houses on land available to them which would help lower income households to purchase their own homes. It was express that the Department of the Environment and Local Government would in vite proposals from the voluntary housing sector as to how to expand on the voluntary housing programme.2.4.5 Bacon Report 3 The Housing Market in Ireland An Economic Evaluation of Trends ProspectsThe third Bacon Report was released on the 6th of June 2000. The first battery-acid of Bacon 3s executive supplymary stated that the rate of increase in housing prices, since the release of the first Bacon Report in 1998 had slowed down meaning(a)ly. The strengthening rescue at the time was blamed for the increased difficulty in securing stableness in the housing market. fireside price completions had increased in each successive quarter in 1999. The average price of new houses was smooth beyond the reach of many average workers. The rate of economic growth at the time meant potential demand for additional 8.000 to 10,000 residential units per annum. The extremity for increased supply in Dublin and the Middle East regions was unhappy as increasingly important to control house pric es due to the predicted increase in demand in that area.2.4.6 Government Response to Bacon3The Government released a report detailing measures which it would take to address housing needs and requirements, as outlined in the third Bacon Report. With regard to Social and Affordable housing, the Government stated that they would increase output of local authority housing that would leap at 1,000 units per annum between 2001 and 2006. The Government also proposed measures that would aim to facilitate Local Authorities and Voluntary Bodies to acquire sufficient land that they could provide social and affordable housing.2.5 Demands for Irish HousingAccording to Norris and Redmond (2005), there have been significant increases in the demand for housing in Ireland during the economic boom, caused by a combination of economic, demographic and social factors. As mentioned in 2.4.1, the Governments taxation policy was favourable to property investors, particularly during the period following the 1986 Urban Renewal Act which initiated Section 23 Tax Relief. The annual housing pomposity rate in 1998 was at 22.5%. At the time this rate of inflation showed no signs of slowing down. The First Bacon Report summarised in 2.4.1, estimated high levels of future demand for Irish housing. The Second Bacon Report pointed to rising rents in the occult rented sector. Social rented housing output was not increasing and in 1999 the local authority assessment of housing need showed that 39,716 households were registered on local authority waiting lists, this was an increase of 43% on the previous assessment of housing need which was complied in 1996, Brooke (2006). The first affordable housing scheme was introduced in March 1999. This scheme provided only 40 affordable houses that year.Part V of the Planning and Development Bill 1999 was structured to address these issues. The Minister for the Environment, Mr Noel Dempsey stated that Part V addressed two major issues in the Irish Hous ing Policy that allowed people to purchase their own homes and also of the provision of social rented housing. According Mr Noel Dempsey (2000), Part V of the Bill, introduces a major new dimension to planning economy and contains the most radical and probably the most contentious provisions of the Bill.2.6 Most Notable Legislation in coition to Irish Housing ProvisionThe following is an account of some of the Legislation that is considered most important in relation to Social and Affordable Housing.2.6.1 Housing Act 1966This Act modernised the legal framework for social housing in Ireland. Is also included the provision for the tenant purchase scheme which allowed local authority tenants to purchase their houses form the local authority. Section 55 of this act relates to a house building programme which each local authority must adhere to in relation to the provision of housing.2.6.2 Housing Act 1988This act defined how homelessness would be interpreted in relation to the provisi on of housing. It allowed the provision of a subsidy to eligible persons against the loans which they had obtained for the purchase or construction of their house. It required local authorities to make an estimation of housing requirements within their functional area both at the present time and over a designated period of time.2.6.3 Housing Act 1992This act introduced the shared out Ownership Scheme which allowed a housing authority to grant a shared ownership lease for a term of more than 20 years but not less than 100 years.2.6.4 The Planning and Development Bill 1999According to the House of the Oireachtas, the Planning and Development Bill 1999 is to revise and consolidate the law relating to planning and development by repealing and re-enacting with amendments the local government (planning and development) acts, 1963 to 1999 to provide, in the interests of the common good, for proper planning and sustainable development including the provision of housing.2.6.5 Part V of th e Planning and Development Act 2000Part V of the Planning and Development Act 2000 dealt with housing supply and it came into effect on 1 November 2000. The primary prey behind the introduction of Part V was to obtain land for housing purposes, as yet the legislation also aimed to improve integration between different social groups by introducing social and affordable housing into private housing estates. The legislation has been the subject of controversy since its inception. Part V of the Planning and Development Act 2000 was resisted by the Construction assiduity Federation and the Home Builders Association. These two groups were the primary objectors of the legislation and claimed that Part V would result in a reduction in supply of new private housing, that will increase second hand prices and the buyers of new houses will subsidise the affordable and social housing being expropriated from the industry Norris, M (1999). Part V of the Act did have supporters that described th e Act as a landmark step that would modernise the planning system in Ireland, improve housing delivery and help reduce undue social segregation in new housing developments. It represents a community and planning gain or return against the windfall profits arising from the development of land Brooke (2006).Part V of the Planning and Development Act 2000 requires that housing strategies be drawn up by planning authorities and integrated into their development plans. Each housing strategy should have regard to the proper planning and sustainable development of an area and should be concerned with the overall supply of housing within the planning authority. In addition, the Act makes communities needs for social and affordable housing a material planning consideration which must be taken account of in formulating development plan policies, preparing a housing strategy and deciding on planning applications or appeals. The Act places a statutory obligation on planning authorities to ensur e that sufficient land is zoned for housing in their development plans to meet the communicate housing requirements over the plan period and to ensure that an undue paucity will not arise, The Planning and Development Act (2000 p.1.).Most importantly the Act empowers a local authority to attach a condition on a planning permission on land zoned as residential, a requirement for developers to supply up to 20% of the land for social and affordable housing. This requirement was set down in the act with the objective to create all new residential developments that will have a proportion of social and affordable housing contained in within it. The provision of social and affordable housing under Part V only applied to developments that were over 0.1 Hectares in size and contained more than 5 units.Part V only applied to planning applications for permission on land zoned as residential use. This requirement was considered a major flaw as it allowed developers to avail of a loop hole of which they could use to avoid the social and affordable housing requirements set out in Part V. This was particularly apparent on Co. Leithrim, where the town of Carrick-On-Shannon was the only area in the county where regularise provisions where present.Part V of the Planning and Development Act 2000 was commenced on the 1st of November 2000. By the 31st of July 2001 all of the local authorities had amend their development plans and had completed new housing strategies that allowed for the new requirements contained in the Act.2.6.6 The Planning and Development Amendment Act 2002This Act allowed developers a greater choice with the provision of social and affordable housing. The Act enabled developers to provide land, sites or housing as an resource to providing social and affordable housing in each development. The secondarys did however have to be contained within the remit of that planning authority. The developer was allowed another alternative to this requirement under the Act, the developer is allowed to pay the local authority a sum of money equivalent in value to the transfer of the land.This amendment of the Planning and Development Act 2000 is considered by many as a weakening or a cop out to the developers. One of the primary aims of the original Act was to counteract social segregation but now this responsibility is effectively left in the hands of the developer.2.7 Government Intervention in Irish Housing ProvisionThe following are the most important examples of Government interventions in relation to the Irish housing market.2.7.1 Local Authority House Building SchemeThe 1966 Housing Act places an obligation on local authorities to provide housing for those who cannot afford appropriate housing for themselves.Redmond, D. and Norris, M.(2005)state that 300,000 housing units have been provided to date, since the introduction of the Local Authority House Building Scheme.2.7.2 House procure Loan SchemeThe House Purchase Loan Scheme was introduc ed for those who have had an unsuccessful loan application with a building society, posit or any other lending institution to build or to buy a residential property. This scheme gave a person an alternative option as to avail of a local authority loan. To ask round this loan the applicant must not exceed an income of 40,000 as a single income household or 100,000 as a dual income household and must have been refused a loan by a bank or building society.2.7.3 Tenant Purchase SchemeThe Tenant Purchase Scheme was introduced under Section 90 of the 1966 Housing Act. Section 90 allowed a local authority to rat on a social house to the tenant. The Act also allowed a local authority to sell a vacant house to whomever they deemed suitable, once the prospective purchaser is in need of housing.2.7.4 1999 Affordable Housing SchemeThe affordable housing scheme was introduce in March 1999. Under this scheme a person can purchase a house from a local authority at a reduced rate to the normal m arket price. The price of the house is subsidised by the Department of the Environment at 50,000 per house in the Dublin local authorities and all city councils and at 31800 for all other local authorities.2.7.5 Affordable Housing Provided Under Part V of the Planning and Development Act 2000As summarised in detail above in section 2.6.5, Part V of the Planning and Development Act 2000 empowers a local authority to obtain up to 20% of land zoned for residential use at a reduced rate from a developer to provide social and affordable housing.2.7.6 Capital Assistance SchemeAccording to the Department of the Environment (2010), the Capital Assistance Scheme enables voluntary housing bodies to provide accommodation to meet housing needs in special areas, such as of people with disabilities, elderly, homelessness, emigrants or small families.2.7.7 Capital Loan and Subsidy SchemeThe Capital Loan and Subsidy Schemes enable voluntary bodies with the means to provide rental housing for low in come families.2.8 shoemakers lastGovernment policy has led to both a high owner occupier rate of housing in Ireland and also high house prices. The aims of the Irish Housing Policy has been greatly affected by government polices. Housing had become less affordable due to previous incentives which promote investment and speculation in the market. It was not until the 1990s when the issue of housing affordability arose. This led to the commission of the Bacon Reports on housing in Ireland.The issue of Social and Affordable housing provision in Ireland became more important during the property boom due to rising prices. This looked to have been on its way to chastisement in the Planning and Development Act 2000 which brought about a smell of coordination in housing provision. However the potential of Part V of the Planning and Development Act 2000 as a mechanism for ensuring sustainable provision of Social and Affordable Housing without social segregation was greatly use up with th e introduction of the Amendment Act in 2002, which provided too many options for compliance by developers. In the current market downturn, affordable housing in its current guise has arguably lost importance in comparison to social housing due to values of all property falling. Therefore updated legislation in relation to Part V is necessary to rectify the current weakening housing policy.REFERENCESNorris, M. (1999) Mixed-Tenure Housing Estates Development, Design, Management and Outcomes. Dublin, The Housing Unit.Dempsey, N. (2000) Planning and Development Bill 2000, second stage, 2nd February, Dil ireann, available http//historical-debates.oireachtas.ie/D/0513/D.0513.200002020018.html accessed 23 February 2010.Brooke, S. (2006) Building for inclusion? Housing output and part V of the Irish Planning and Development system. Dublin. Focus Ireland.Bacon, P and Mac Cabe, F. (1998) Bacon Report 1 An Economic Assessment of Recent House Price Developments. Dublin, Stationary Office, Mini ster for Housing and Urban Renewal.Bacon, P and Mac Cabe, F. (1999) Bacon Report 2 The Housing Market an Economic Review and Assessment. Dublin, Stationary Office, Minister fo