Agency financing student housing is not going to ‘police rent’

The Housing Finance Agency plans to double its loan book by the end of 2026 to deliver 19,000 new homes and more than 3,000 new student beds, an Oireachtas committee has been told.

Three universities had loan applications approved last year totalling €168 million for the provision of 1,430 new student bedrooms with more loan applications expected this year.

Chief executive of the agency Barry O’Leary said the agency does not stipulate the level of rent that universities or colleges must or can charge when they are providing finance.

“We are lending to universities on a 30 year basis at less than a 2 per cent fixed (rate). I can guarantee you there is no one out there delivering cash cheaper than that. We are lenders, we are not policemen, we are not going into a university and saying you should deliver this rent.”

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The agency provides cheap and long-term finance to local authorities and approved housing bodies in an effort to help with the delivery of social and affordable homes across the country.

Representatives from the agency appeared on Tuesday before the Oireachtas Committee on Housing where TDs were told that the commitments made in the Government’s Housing for All plan would be achievable. The plan commits to delivering 90,000 social homes by 2030.

Mr O’Leary said the majority of its loan book of €5.9 billion was lent to local authorities and approved housing bodies. A further €1.45 billion will be lent to local authorities over the next five years according to its forecasts. This includes €750 million in finance for the recently launched Local Authority Home Loan scheme and €250 million for the Retrofit Home Loan scheme.

The loan book will be doubled by the end of 2026 delivering 19,000 new homes and 3,300 new student beds, Mr O’Leary said. There was a “strong pipeline of projects” in the system, he added, with loan advancements up 21 per cent on 2020.

The chief executive of the Housing Agency Bob Jordan also appeared before the committee and said that up until February of this year some 1,727 households had been supported to remain in their homes through the Mortgage to Rent scheme. The Housing for All plans contains a target of an average additional 1,000 households being assisted by the scheme in each year until 2026.