Cavan demand for affordable housing is rising

Cavan County Council is experiencing a surge in applications for its affordable housing scheme, as decreasing house prices and uncertainty is turning many first time buyers off the private market. But the slowdown in the construction sector means that there are now less affordable houses coming on stream and successful applicants in the county can expect to wait at least a year before being offered a house under the scheme. Affordable Homes are homes that are provided at a discount to the market value for qualifying buyers who cannot afford to buy a home on the open market. There are strict qualification criteria and applicants must have enough income to support mortgage payments. So far this year, the local authority has received 30 applications for affordable houses, compared to 25 in total last year. This is already a 20 per cent increase with four months of the year left to run. In total, there are 55 live applications for affordable houses with Cavan County Council, all at different stages of processing. Demand for the scheme is outstripping supply - with just such 28 houses currently available in the county. And with builders waiting for the existing supply of houses to sell before continuing with subsequent phases of developments, it"s unlikely there will be many more affordable houses becoming available before the end of the year. Developers must give over up to 20 per cent of their housing supply under new residential developments for social and affordable housing under planning laws. However, they can opt to give a monetary payment to the local authority in lieu of houses. Michael Geelan, the senior executive officer of the Council"s housing section, explains, however, that some of the current applicants may not meet the criteria to qualify for the scheme. Qualifying applicants should expect a wait of at least a year to be offered a house under the scheme. 'At the moment, people that applied in 2008 can expect an offer in 2008,' said Mr. Geelan. Successful applicants can nominate their preferred areas in the county and will only receive offers of houses in those areas. If an applicant turns down a house, Mr. Geelan explains that they stay on the list until such time as another house, matching their specifications, becomes available. But he warns: 'You will get up to three offers before you are taken off the waiting list.' The 28 houses currently available in Cavan range from two-bedroom to four-bedroom houses and are located throughout the county in Arva, Ballinagh, Bailieborough, Ballyhaise, Belturbet and Cavan town. The houses come complete with fitted kitchen, fireplace and en-suite bedroom, and range in price from €120,000 to €150,000. To qualify, applicants must be: owner/occupiers, first time buyers, permanently employed for six months or self-employed for two years, have a deposit of three per cent of the purchase price and prove they are in a position to make the necessary mortgage repayments. Mortgages are not organised by Cavan County Council but must be secured through a private lender. Single income applicants must not earn more than €58,000; while a formula is applicable for joint applicants. Add two and a half times the larger income plus one times the smaller income. If the total does not exceed €145,000, then you are eligible to apply. There is a claw back clause imposed on all houses sold under the affordable housing scheme. It is based on percentages. For example, if you purchase a house for 20 per cent less than its market value under the scheme, then if you sell it within ten years, you must pay ten per cent of the sale price back to the local authority. After than, the claw back amount reduces by one tenth for each full year you live in your home. The claw back clause expires after 20 years. Mr. Geelan explains that it only applies if owners of affordable houses sell their home within 20 years. It does not apply to remortgaging. Also, if the property is sold for less than it was purchased for, the claw back is not claimed. For further details of the affordable housing scheme in Co. Cavan, e-mail dfitzpatrick@cavancoco.ie or telephone Deirdre at 049-4378319.