Total loan approvals by Home Building Finance Ireland (HBFI), set up by the Government to fund the delivery of new homes, grew 38 per cent in the six months to the end of June compared with the previous six months.
The group lent €1.16 billion, which was up from €835 million in the six months to the end of 2021, it said on Friday.
The performance – HBFI’s busiest-ever six-month period, based on approval volumes – means that HBFI has now committed 58 per cent more than the €730 million capital initially allocated to it at inception three and a half years ago.
HBFI said it will continue to have “significant lending capacity available” for future lending from recycling the proceeds from existing loan repayments. It also has the ability to access additional capital through market-based borrowing if required.
It had approved funding for 5,210 new homes in 86 developments in 20 counties at the end of June. This includes two new counties for the first time – Kilkenny and Limerick. Social housing projects account for 23 per cent of the new homes approved for funding.
Some 715 HBFI-funded units have already been completed and sold, with a further 1,783 contracted for sale or sale agreed.
Of the €1.16 billion approved, drawdowns have taken place in respect of facilities totalling €737 million, for 50 developments totalling 3,229 units where construction is in progress or has completed.
HBFI typically expects a time lag of between three and six months between a loan being approved and its first drawdown.
Units funded by HBFI range from one bed apartments (13 per cent) to five bed houses (2 per cent), with the majority consisting of three bed (38 per cent) and two bed (30 per cent) units aimed at the first-time buyer market.
Individual loan facilities range from €1 million to €94 million, with an average size of €13 million. Terms of these facilities range from six months to 48 months, with an average of 22 months.
HBFI chief executive Dara Deering said: “This is excellent news for the supply of much-needed new homes and demonstrates a remarkable bounce-back by housebuilding firms that has continued since the early months of the pandemic.
“It is also excellent news for the owner-occupiers, renters and people needing social housing who are now living in HBFI-funded homes or will be moving into them in the coming months.
“We remain vigilant to risks such as construction price inflation, but we will work closely with the housebuilding firms we lend to in helping them address these challenges and continue adding to the supply of new homes.”
Minister for Finance Paschal Donohoe said increasing the supply of housing “remains a priority” for Government.
“Through its broad product range, and agile business model, HBFI plays a key role in the Government’s strategy to meet the targets set out under the Government’s Housing for All plan,” he said.
“Today’s update highlights the strong performance by HBFI over the last six months, with funding approved since inception for 5,210 new homes in 86 developments in 20 counties.
“I welcome the continued support for social housing, with social housing projects accounting for 23 per cent of the new homes approved for HBFI funding.
“I am confident HBFI will continue to monitor the risks and opportunities for future funding. I wish to thank HBFI and its staff for their continued work, particularly over the last six months.”
