Minister English’s speech at the Housing Practitioners’ Forum
Minister English’s opening address at the Housing Practitioners’ Forum at the Red Cow Moran Hotel
Check against delivery
Ladies and gentlemen, thank you very much for inviting me here this morning to be part of the first Leasing Practitioners’ Forum.
Leasing is an increasingly important mechanism for the delivery of social housing and it is critical that it is given the appropriate time and effort in order to ensure that we all realise the opportunity that presents itself in a buoyant market and capture the potential of private sector activity.
The creation of this forum reflects the Government’s commitment to supporting the provision of a range of social housing solutions that addresses the immediate needs of families in your areas.
This important initiative is just one of a large number of actions being taken to implement Rebuilding Ireland, the Government’s Action Plan for Housing and Homelessness
I know that we all have put a lot of effort in in the past 12 months in order to bring together new ideas for leasing and to transform the delivery stream into a more attractive prospect for investors seeking to provide social housing.
Now is the time to share our experiences and build on the previous work to develop a real pipeline of properties and streamline our processes in order to more quickly realise our overall objective – to house more people, quicker.
I know from talking to all parties concerned that leasing is starting to gather momentum following significant collaboration, consultation and a considerable effort put in at a local level. The result will be increased output in 2019, providing much needed high-quality homes for families in your areas.
This Government recognises the serious challenge we face in terms of housing and a critical focus and priority has been firmly placed on responding to this challenge through the development and implementation of the Rebuilding Ireland Action Plan for Housing and Homelessness.
Rebuilding Ireland is a €6 billion, multi-annual, broadly based action plan which seeks to increase the overall supply of new homes to 25,000 per annum by 2020; deliver an additional 50,000 social housing units in the period to 2021; and meet the housing needs of an additional 87,000 households through the Housing Assistance Payment (HAP) scheme and the Rental Accommodation Scheme.
The Rebuilding Ireland Action Plan, together with initiatives announced on foot of the targeted review of progress, which was undertaken last year, as well as additional measures announced under Budget 2018, provides a robust framework for addressing the housing and homelessness challenges we face. The Government’s/ Department’s focus and that of all delivery agents will remain on implementation and delivery to ensure that the range of objectives and targets set.
My Department and its partners for delivery, yourselves in Local Authorities, the Housing Agency and Approved Housing Bodies, are all highly engaged in mobilising their teams and growing capacity for delivery. My primary task, as Minister of State for Housing and Urban Development, lies in driving those efforts forward with ambition and commitment.
In terms of leasing, under Pillar 2 of RI 10,000 leased properties – built and owned by the private sector – are targeted to the brought into use for social housing using a range of different longterm arrangements. That number, represents one in five of all new homes additional social housing homes being targeted out to 2021.
The Department, together with input from yourselves local authorities, the Housing Agency and in consultation with housing market operators generally, has developed a suite of products that can suit all forms of property owners and investors including; revised standard Long Term Leasing, the Enhanced Leasing Scheme, the Repair and Leasing Scheme, AHB leases and P&A agreements, short term leasing options such RAA and RAS-type contracts and the Mortgage to Rent scheme, which utilises leasing arrangements to attract inward investment, an important development that keeps people in their homes.
The intention is to provide yourselves as local authorities, a catalogue of tools that you can use to harness high quality housing. That could include existing vacant properties, apartments or new build properties. They provide flexibility to you to respond to the differing types of property owners – those that are set-up to provide ongoing property management services; those that aren’t; those property owners prepared to provide landlord services and those that aren’t.
At this juncture, a high level of progress is already being made in meeting Rebuilding Ireland’s social housing targets. The overall target for 2016 was to meet the needs of some 17,000 households – in excess of 19,000 were achieved. Further progress was made in 2017 with the target of 21,000 units being significantly exceeded with the delivery of almost 26,000 units. The 2018 performance is currently being totalled but all indications are that it will be another successful year.
Reaching leasing targets can be challenging, particularly in an environment where the rental market is strong. There is an onus on us all, therefore, to approach the coming year with a renewed enthusiasm and a forward-looking approach to reaching our collective targets. Seeking out new opportunities and understanding the interaction between secure, long term leasing arrangements and the minimisation of development risk can open the doors to new development in your area and new homes for families.
The Enhanced Lease has generated significant interest from the market and can significantly contribute to reaching our targets in 2019. The benefits are clear – it brings greater numbers to the table quicker, a minimum of 20 units in any one proposal, and obliges the property owner to take on the management of the properties.
We know that the launch of the launch of the Enhanced Lease has also stimulated significant market interest in the existing long-term leasing arrangements, where the investor obligations are not as onerous. The Department has revised the lease terms to more closely align them with the provisions of the Enhanced Lease, allowing for a 25 year lease term and index-linked rent reviews. This renewed interest has started to translate into real delivery and can be further capitalised on to result in increased output.
While take-up in the RLS was initially slow, it remains an innovative solution that can have significant spin-off regenerative benefits, particularly in small towns where there are still vacant units in town centres.
The availability of the Agreement for Lease document for prospective developers provides certainty that, once they build and deliver on-time, the Local Authority will execute a long-term lease on the properties. This can have a transformative effect on accessing development finance and stimulate the construction of new units – a fundamental aspect of Rebuilding Ireland.
These are the tools available to us that can allow us to reach our targets, we need to fully understand these in order to maximise their impact – something that this very forum seeks to achieve.
The role of Local Authorities
Local Authorities, such as yourselves, know the important contribution that you play in social housing delivery. We rely on the sector and we have trust and faith in you. You are the front line in the delivery of real housing solutions and the first port of call for anyone that wants to engage in delivering social housing.
You have the on-the-ground knowledge of demand in your respective areas and are best placed to guide interested parties in their efforts to provide housing solutions.
The public also recognise the sector’s endeavours to not only deliver social housing, but to deliver sustainable communities. Looking around today, I am confident that everyone in this room has the same aim – to provide real families with homes for the future.
And that is what is at the heart of all that we try to do – it is not just building houses, we are building strong and sustainable communities, where people are proud to call home and where we can bring up our children and their children in a safe, sustainable and caring community.
Challenges will remain post 2021 and we need to make sure that we tailor appropriate and effective housing solutions, such as long term leasing, for our communities and do not unintentionally give rise to a housing crisis for future generations.
It’s not going to be easy but I firmly believe that we are on the right path to fix what is wrong now while also putting in place a sustainable housing system for future generations.
So what then is the purpose of the day? Essentially there are 2 aspects:
To ensure that you all are aware of the key work that has been occurring in the development of the new and revised leasing schemes, and that you and colleagues understand the options available to you.
To work together to break down barriers to progress, explore innovation, and hear first- hand experience of both the Departments’ and LAs activity to overcome challenges
This bringing together of expertise in a focussed and targeted fashion will have a real impact on future delivery.
I wish you all the best for 2019, in what will be an exciting time for delivery under the various leasing schemes.
The Five Pillars
The Action Plan for Housing and Homelessness includes a comprehensive Five Pillar approach – these pillars are the foundations upon which we will build our plan. They are open to debate, additions and amendments, but for now they will be our starting point for immediate action.
This is an initiative of the Government of Ireland