Fact check: Report said €11.5bn of private cash needed for 33,000 homes

Wed, 20 Nov, 2024 - 14:14

By August Graham, PA

In its manifesto the Labour Party said: “A recent report for the Department of Finance estimated 11.5 billion euros of private financing will be required per year to reach a target of 50,000 homes a year.”

Evaluation

This is not supported by a Department of Finance report from earlier this year. That report estimated that €11.5 billion of private finance would be required every year to deliver 33,000 homes, the current target under the Government’s Housing for All plan.

That same report says that to deliver 50,000 homes a year it would require €16.9 billion.

The facts

In June 2024 the Department of Finance released a paper called “Report on the Availability, Composition and Flow of Finance for Residential Development.”

That document said: “The report sets out the estimated level of development finance (including debt and equity) that will be required to deliver on the current annual Housing for All target of 33,000 homes.

“Adjusting for construction cost inflation since the time of the last report, the modelling estimates that 13.6 billion euros of development funding will be required per annum, of which an estimated 11.5 billion euros will be required from private capital sources.”

It later adds: “A scenario of a target of 50,000 units per year was included as an illustrative example, to demonstrate the level of development finance required in that scenario.

“The graph below illustrates the increase in the level of funding required from both the public and private sector to meet this output. The funding requirement increases to 20.4 billion euros, of which 16.9 billion euros would be required from private capital sources.”

The Labour Party was asked for the source of its claim that the Department of Finance estimates it would require €11.5 billion of private financing to reach a target of 50,000 homes a year.

It sent a response saying, among other things, that the “statistic is for illustrative purposes of the proposed level and scale of private financing required.”

It added: “The figures in the DOF report for private sector development don’t correlate to the figures we’re proposing on state-led or private-led construction.”

The rest of the response focused on Labour’s policies, not on the statistic in question. It did not respond to a further email seeking clarification.