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The Affordable Housing Bill 2020

By February 18, 2021June 26th, 2024No Comments



The Affordable Housing Bill 2020 published by Minister for Housing, Local Government and Heritage

On the 20th of January 2021, the Affordable Housing Bill was published by Minister for Housing, Local Government and Heritage, Darragh O’Brien. The Bill introduces two significant schemes to address the housing affordability crisis in Ireland: –

  1. A new Affordable Purchase Shared Equity scheme where the State would provide equity support to households seeking to purchase homes in the private market but are unable to secure the full mortgage to do so.
  1. The introduction of a new form of tenure in ‘Cost Rental’. This scheme will provide the basis for the first 400 Cost Rental homes in the State which will be delivered in 2021 with many more in the pipeline in the years thereafter.


Affordable Purchase Shared Equity Scheme

This scheme provides for the State to take up to 30% equity in the property and the Purchaser will take out a mortgage on the balance of the purchase price. At present, the following conditions must be met to avail of this scheme:

  1. The property must be a new home
  2. The purchaser must be a first-time buyer

However, further conditions may apply that are yet to be determined. These may include conditions in relation to price, salary caps on eligibility and geographical location.

Details of eligibility will be set out in separate guidelines to allow the Minister to retain flexibility to vary the criteria from time to time.

The scheme will allow for an option to buy out the State’s equity share once certain conditions are met.

It is envisaged that the once the scheme is finalised it will be open to all new build homes, subject to regional price caps and targeted at first time buyers.

Minister O’Brien has confirmed that that an initial €75 million has been set aside in Budget 2021 to start the scheme and this will be boosted with additional private investment.


Cost Rental Scheme

The scheme introduces Cost Rental tenancies, a form of long-term rental. In this new form of tenure, a state body, such as a local authority, will provide rental accommodation to those who are above the threshold for social housing but unable to afford to buy their own property or rent on the open market. It is important to note that Cost Rental tenancies are not classified as social housing.

The landlord will charge rent based on the cost of managing and maintaining the property rather than for profit. This will result in a lower rent than market rent for Cost Rental tenants.

Cost Rental tenants will also be covered by the Residential Tenancies Act 2004 to 2020 and may avail of all legal protections as tenants in the private rental sector.

The Bill allows for rent to be increased on an annual basis in line with inflation to account for potential increases in costs over time.

The Cost Rental Equity Loan (CREL) scheme was introduced in Budget 2021 and is set to give €35 million in loan funding to Approved Housing Bodies for the purpose of the provision of Cost Rental Housing.


While final details are still to be ironed out regarding the conditions of the schemes, the Bill is a step in the right direction towards addressing the current housing affordability crisis in Ireland.

If you have any queries in relation to the above or any other matter please do not hesitate to contact us on 01-2960666