EIB creates €300m fund for investment in social housing

Minister for the Environment, Community & Local Government, Alan Kelly & Minister of State for Housing, Paudie Coffey, have today welcomed a new €300m fund for investment in social housing.

The new investment programme jointly backed by the Housing Finance Agency and the European Investment Bank will target an additional 2,000 social housing units to be developed over the next three years.

The new programme, the first ever support for housing in Ireland by the European Investment Bank, was officially announced during a visit to Killarney Court in north Dublin by Ministers Kelly & Coffey and  Jonathan Taylor, Vice President of the European Investment Bank and Barry O’Leary, CEO of the Housing Finance Agency plc.

The funding will be available to approved housing bodies for the upgrade and delivery of social housing.

During the visit, representatives of Cluid Housing Association outlined how local residents have benefited from investment to reduce heating costs, provide play areas and improve buildings under a recent upgrading scheme.

300M

Welcoming the new initiative Minister Kelly stated that “This will give housing bodies access to finance at very competitive rates and facilitate quicker deliver of approximately 2,000 additional social housing units. Government is committed to ensuring that financially sustainable mechanisms are in place that can meet both current and future demand for social housing and ensure value for money for taxpayers.

The vision outlined in the government’s Social Housing Strategy 2020 is that every household will have access to secure good quality housing suited to their needs at an affordable price and in a sustainable community. This new agreement between the EIB and the HFA represents very good progress in that direction and I strongly urge the Boards and Management of certified Approved Housing Bodies to grasp this opportunity and access this finance in order to help achieve the challenging targets set out in the Social Housing Strategy.”

Minister Coffey said: “This announcement is an indication that this government is willing to use innovative measures to deliver finance so that housing units can be delivered where demand exists.  We need to increase the number of housing units completed in this state in order to meet demand and Social Housing is going to play a key role in the overall strategy.  By using this method of housing delivery we will ensure that we are providing sustainable housing at affordable prices.

This is just one of the methods of housing delivery in the Social Housing Strategy and underlines both mine and Minister Kelly’s commitment to tackling the acute housing need that currently exists.”

Jonathan Taylor, European Investment Bank Vice President added that: “This new engagement will improve social housing across Ireland and represents the first ever EIB lending for the housing sector in the country. We are pleased to work closely with professional housing experts at HFA in a scheme that will benefit both local residents by providing better homes and reduced energy costs, and work for local construction firms.  Investment in housing is essential for family life and sustainable communities and we look forward to further support for the sector in Ireland in the years to come.”

Barry O’Leary, CEO of the HFA said that “the HFA is pleased to have secured a facility which allows us offer our customers 25 year fixed rate funding at very competitive rates and we welcome the endorsement from the EIB of our credit assessment and review processes. Interest in the product offering is very high and we expect the fund to be significantly over subscribed.”

The €150m funding from the European Investment Bank will be matched by the HFA to provide €300m available for lending to support investment by Approved Housing Bodies across the country to upgrade social housing and improve energy efficiency. By accessing EIB funding the HFA will be able to offer Approved Housing Bodies long-term finance at extremely competitive rates. The new social housing development scheme is supported by a guarantee from the Minister for Finance and underpins the strong commitment from the EIB for the provision of long term development finance in Ireland.

The Social Housing Strategy 2020 targets the provision of 35,000 new social housing units over a six year period, the support of up to 75,000 households through an enhanced private rental sector and the reform of social housing supports to create a more flexible and responsive system. The Strategy sets out a multi-annual approach to underpin the delivery requirements over two phases. Phase 1, building on Budget 2015, sets a target of 18,000 additional housing units and 32,000 rented units by end 2017. Phase 2 sets a target of 17,000 additional housing units and 43,000 rented units by end 2020.