Every family needs a home.
House prices are 90% higher than they were in 2012. In addition, the Central Bank of Ireland’s rules require that first time buyers need a 10% deposit (on the first €220,000 and 20% thereafter) and that these mortgages be limited to 3.5 times their income. This cocktail of house prices, spiralling rent combined with strict rules have meant that home ownership levels have slipped to record lows of 67.6% across the country. These are the lowest since 1971, down from a high of 82% in 2004.
The age at which home ownership became the majority tenure category was 35 years in 2016. Prior to that age, more householders were renting rather than owning their home. In comparison to previous censuses dating back to 1991, the ages which marked the changeover between renting and home ownership were 32 years (2011), 28 years (2006), 27 years (2002) and 26 years (1991). Clearly home ownership is moving further and further away for young people.
Reflecting the CSO data in Ireland the Resolution Foundation in the UK has found that homeownership rates have slipped most dramatically amongst millennials.
Declining home ownership is the most prominent worry about younger generations, and the changes are indeed large. So far millennial families are only half as likely to own their home by age 30 as baby boomers were by the same age.
An even bigger reduction in access to social housing means that four-in-ten millennial families at age 30 live in the private rented sector, four times the rate for baby boomers when they were the same age. This rise in private renting means that young adults face greater housing insecurity than previous generations did. They are compromising on quality and convenience too.
Adults aged under 45 have slightly less space than they did two decades ago, whereas over 45s have more. And young adults are commuting longer distances: millennials are on track to spend 64 more hours commuting in the year they turn 40 than the baby boomers did at that age.
Fianna Fáil is committed to facilitating and enabling homeownership. A strong affordability scheme is vital to securing that.
Why Do It?
We cannot be solely reliant upon the private sector to provide homes. The state has to step up and build affordable units in the right places. This is a core part of Fianna Fail’s vision for securing home ownership for the next generation.
Fianna Fáil’s plan to help first time buyers
A National Redevelopment Agency.
National Redevelopment Agency should focus on constructing new units on existing state lands. This has the capacity to deliver over 42,000 units.
Affordable Purchase Scheme.
A new €500m per annum Affordable Purchase Scheme site subsidy. This will provide €50,000 per unit to reduce the price of each home to between €160,000 and €210,000.
Finance local authorities.
Special purpose vehicles to provide finance to local authorities for overall investment.