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The Department of Environment, Heritage and Local Government released the following statement:

The Minister for Housing and Local Services, Michael Finneran TD announced the commencement of the Incremental Purchase Scheme (IPS).  The Scheme is a central element in delivering on the housing objectives set out in the Government’s housing policy statement, Delivering Homes, Sustaining Communities and opens up a new avenue for social housing applicants and tenants to purchase their own homes.  It also, for the first time, provides a mechanism for approved housing bodies to offer new houses for sale. 

The Minister pointed to a number of key benefits that the Scheme provides for purchasers: “the scheme offers the earliest possible start on the path to home ownership for those willing and able to undertake a house purchase.” It allows social housing tenants and persons who have an assessed housing need avail of attractive discounts, from 40% to 60% of the total cost of the house depending on income, to purchase a new home. The scheme is also structured to make it attractive for people to put down long-term roots in the community and to commit to an area, thereby contributing to more stable and integrated communities. Finally, by giving the new owner responsibility for repair and maintenance of the home the scheme helps build up the householder’s stake in the property.

For the State, the scheme will provide an opportunity to extract additional value for money from capital expenditure through our social housing investment programme.  It will allow capital funding to be recycled quickly which can then be used to provide additional social housing.  “In the current economic circumstances”, the Minister Finneran explained, “it is important that we use all available resources to their fullest potential to meet the challenge of providing suitable accommodation for those households in need of it. 

Minister Finneran also took the opportunity to announce his intention to bring to an end the current tenant purchase scheme, introduced in 1995.  Legislation is planned for 2011 to underpin a new scheme for the sale of existing local authority houses to tenants based on the incremental purchase model.  To ensure an orderly wind down of the existing scheme, the Minister has instructed housing authorities to inform all existing tenants of houses as soon as possible (and new tenants on allocation of a house) of the decision to end the scheme, to ensure that they have enough time to apply to purchase their home under the existing scheme, if they so wish.  The existing tenant purchase scheme will end in 2 years time for new applicants.

Main Terms of the Scheme

The Scheme is being brought into effect by way Regulations made under the Housing (Miscellaneous Provisions) Act 2009 and come into operation on 14th June.  The scheme will make it possible for households in receipt of or eligible for social housing support to purchase designated new local authority and voluntary / co-operative houses.  The scheme works by transferring full title to the new house to the purchaser on the payment of between 40% and 60% of the all-in-cost of the house, depending on the applicant’s income. .&