Govt commits over €5bn investment for housing delivery next year
The Government has committed over €5bn in capital investment for housing delivery next year.
This is in addition to investment by the Land Development Agency and Approved Housing Bodies.
In his budget speech, Minister for Finance Paschal Donohoe announced €200m of additional external funding for Home Building Finance Ireland, which provides finance to homebuilders across the country.
In a bid to support the upgrading of rental housing stock, the Government will be extending the income tax deduction for small landlords who retrofit their properties for a further three years.
“These measures are designed to encourage more stock into the housing market and to support the development of higher quality homes,” Mr Donohoe said.
The Residential Development Stamp Duty Refund Scheme which was due to expire at the end of this year will also be extended, to the end of 2030.
This scheme provides for a partial repayment of the stamp duty paid on a deed of conveyance or transfer of land where the land is subsequently developed for residential purposes.
Mr Donohoe also announced the extension of the Living City Initiative to the end of 2030.
The scheme supports the enhancement of older housing and commercial properties in certain areas.
The scope will also increase to include residential properties built before 1915 to those built before 1975.
The scheme has also been amended to support the use of ‘over the shop’ premises for residential purposes, while the maximum amount of relief available will be increased from €200,000 to €300,000.
The Government also plans to add five regional centres under the National Planning Framework to the scheme – Athlone, Drogheda, Dundalk, Letterkenny and Sligo.
Government announces new Derelict Property Tax
Meanwhile, the Government announced a new Derelict Property Tax, which will be implemented and collected by Revenue.
“Dereliction is a blight on our towns and cities,” Mr Donohoe said in his Budget speech.
“We need to bring those properties currently lying empty back into use,” he added.
The new tax will replace the Derelict Sites Levy, which is currently charged at a rate of 7% on the site market value.
“I do not intend for the new tax to be charged at a lower rate than this,” Mr Donohoe said.
He said he plans to bring forward legislation providing for the new tax in 2026.
“Preliminary registers of dereliction will be published in 2027 and the tax will be implemented as soon as possible after this date,” he said.
He announced that the Rent Tax Credit, which was introduced in Budget 2023 and was due to expire at the end of 2025, is to be extended for a further three years, to the end of 2028.
Mortgage Interest Tax Relief is to be extended for a further two years with a reduced value applying in the final year.
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