Politics

Rent subsidy for middle-income families is under consideration

Government is discussing new payments in order to ease pressure on social housing

A new system of payments to middle income families to subsidise the cost of high rents is being considered by the Government. Photograph: Gareth Fuller/PA Wire
A new system of payments to middle income families to subsidise the cost of high rents is being considered by the Government. Photograph: Gareth Fuller/PA Wire
Fiach Kelly
Sat Nov 12 2016 - 01:01

A new system of payments to middle-income families to subsidise the cost of high rents is being considered by the Government.

The payments would be aimed at households with a combined income of up to €55,000 as a temporary measure to prevent more families entering social housing programmes.

There is some concern in Government, however, at the prospect of linking a new, indirect payment to specific income levels. A number of other options are also on the table.

Government sources have said the plan is in the very early stage of discussions for inclusion in the rental strategy to be announced by Minister for Housing Simon Coveney in the coming weeks.

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It comes as pressure mounts on the Government to tackle the high cost of rents, particularly in cities and large towns.

Sources said that while the overall focus of the plan will be on encouraging greater supply of homes, it is acknowledged that more immediate measures are needed to help with the high cost of rents.

Soaring rents

The latest quarterly report from property website Daft.ie this week showed that rents increased by an average of 11.7 per cent in the year to September, the largest annual increase since the website began compiling its reports in 2002.

Mr Coveney has rejected so-called rent certainty measures, which would link rental prices to the rate of inflation.

The aim of the proposed payment is to help those whose income places them above the threshold to avail of Housing Assistance Payment (HAP), in which councils make payments to landlords.

Those in receipt of HAP must be on social housing lists.

Well placed sources also said an aim of the payment would be to prevent people in housing difficulties from going onto the social housing list.

“Once you get into social housing it is very difficult to get off that system,” said one.

Mr Coveney is also understood to be considering State subsidies to developers to encourage the construction of developments to be used exclusively as long-term rental properties.

Another expected aspect of the plan is to encourage housing agencies to construct properties suitable for long-term rental at levels below the market price.

Funding is available from Government for Mr Coveney’s rental strategy.