Sinn Féin spokesperson on Housing Eoin Ó Broin TD has described the government’s shared equity loan scheme as a pro-developer scam. 

The Dublin Mid-West TD has warned that it will push up house prices and saddle working people with ever greater levels of debt.

Teachta Ó Broin said:

“After much delay and even greater criticism, Minister for Housing Darragh O’Brien has launched his shared equity loan scheme. 

“This is nothing short of a pro-developer scam. 

“It will push up house prices and saddle working people with ever greater levels of debt.

“The scheme was designed by two industry lobby groups, Property Industry Ireland and Irish Institutional Property. 

“It is based on an English scheme that has been shown by the London School of Economics to have pushed up house prices in London by 9%.

“Crucially, the scheme not only ignores the problem of high house prices, but will make that worse. At best, it will lock in those unaffordable prices. At worst, it will drive them up further.

“I am also concerned with the interest charge being raised on the debt. Despite the interest rate only kicking in in year six, over time it will add even more debt onto many working families. 

“In the government’s own example on the First Home Scheme website, over a 30-year period the cost of the debt will amount to €23,800 on a €50,000 equity loan. 

“This means that when house price inflation is taken into account, a hard-working person or couple could spend 30 years paying off their mortgage and still have a debt of up to €100,000.

“There is also a concern that like the so-called Help to Buy Scheme, many people who do not need this scheme to buy a home will still access millions of euros of public money. 

“To date almost €200 million of public money has been given to home buyers who had a despot and a mortgage.

“The solution to the affordable housing crisis is not to push up house prices and increase personal debt, but to deliver tens of thousands of genuinely affordable homes at prices working people can actually afford. 

“Until the government does this the affordable housing crisis will continue. This scheme should be scrapped and the funds diverted into the delivery of genuinely affordable homes.”