The Budget measures announced focus on delivering the Government’s housing program for 2019.
The Minister announced the allocation of €2.3 billion to the Government’s housing programme for 2019, with an allocation of €1.25 billion for the delivery of 10,000 new social homes. The new homes will be delivered through a combination of construction, acquisition and leasing. These are welcome measures, which in combination with the private sector will continue to make progress towards easing of the acknowledged housing crisis.
The involvement of the newly established Land Development Agency in the delivery of these projects provides an interesting and exciting opportunity to increase housing supply, with clear targets on 3,000 houses and expectations of a further 7,000.
The minister announced full restoration of interest relief for mortgages on private rental accommodation. The relief had been restricted a number of years ago, and was not due to be restored until 2021.
Despite some rumours in the weeks leading up to the Budget, it is welcomed that the minister has not altered the stamp duty rate applicable to Private Rental Sector (PRS) projects. Given the current housing challenges, any such change could have led to delays in project acquisitions, reduction in investment and ultimately increases in the cost of delivering large scale rental developments.
The new valuation date for Local Property Tax (LPT) is 1 November 2019. A public consultation was undertaken by the Department of Finance in April 2018 and the minister stated the report will be published in due course. The consultation will have particular regard to valuation issues. The minister reassured homeowners that any future changes in LPT will be moderate and affordable.