Part V of affordable housing arose from housing units or sites set aside by developers as a condition of planning permission. This arose under part V of the Planning and Development act. The local authority could designate certain houses as affordable housing. Persons eligible to buy affordable houses potentially qualified if 35 percent of their income would not cover the cost of the housing.
A separate affordable housing initiative was introduced under a National Agreement Sustaining Progress. The OPW provided lands on which new houses were built and sold.
Local authority provides sites for houses to persons in need of housing. The prices may be as low as nominal. The building costs may be met by local authorities or financial lending institution. The arrangements were used in conjunction with the shared ownership scheme, affordable housing scheme or mortgage allowance scheme.
It is required that the applicant
- is registered on a waiting list with the local authority or
- is a tenant who wishes to give back a local authority house or
- a tenant for more than one year of a home provided by a housing association under rental subsidy scheme who wants to buy a house and return the present house
- or a member of cooperative or non-profit housing society of which 75 percent of members are tenants, tenant purchasers or registered on local authority housing lists or
- a person involved in a group shared ownership project.
If the house is sold within ten years, the local authority may claw back a portion of the difference between the sale price and market value.
Local authority mortgages are available in principle of up to 97% of the price. There is a cap at €220,000 . New payments must not exceed 35 percent of net household income.
A local authority mortgage is an annuity mortgage with variable interest rates. A person may qualify for local authority mortgage if he cannot obtain a loan from a bank or a building society are a first-time buyer and satisfy the income test.
The income test requires gross income of €50,000 or less for single income or a combined income of €75,000 for less for double income households.
The Mortgage Allowance Scheme provides an allowance of €7,450 (€11,450) payable over five years to tenants or tenant purchaser of local authority houses. It is also available to tenants of local housing authorities in housing provided under the rental subsidy scheme which wish to buy or build a house with a mortgage. The payment is made directly to the lender and accordingly repayments are reduced for the first five years. The mortgagee may be a local authority or a financial institution.
Income must be less than €28,000 and the mortgage must be at least €38,000. The allowance is payable on a reducing basis over in each of the first five years. Payment in the first year is €3560 reducing to €1270 Euro. The house must be suitable and meet certain standards. Persons may be eligible
if they are local authority tenants who wish to buy a private house and return the local authority house or
a tenant for more than one year of a house provided by a housing association under a rental subsidy scheme which they wish to return on purchase of the house.
The Home Choice Loan Scheme was provided by designated local authorities on behalf of all local authorities. It provides mortgages for first time buyers who cannot get a mortgage or finance from a bank. The applicant must be a first-time buyer and earn at least €35,000 for a single applicant and €45000 for a joint applicant. He must be in continuous employment for at least a year and had been unsuccessful in obtaining mortgages from two financial institutions to buy a property.
New or second-hand properties or self builds could be acquired under the scheme. The property must be acceptable for sale in the open market, covered by defects insurance and not larger than 175 square meters. The Home Choice Loan could be for up to 92 percent of the market value of the house or to a max of €28,5000. The mortgage term could be for a term up to 30 years. There is a single variable rate.
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