First-time buyers will be able to avail of a new grant for repurposing derelict properties under new measures being drawn up by the Government this month.
The Government has announced plans which will allow first-time buyers to purchase a derelict or vacant property and turn it into a home without the need for planning permission.
The new regulations will also see eligible first-time buyers with mortgage approval receive a grant of between €20,000 and €30,000 in plans being drawn up which are aimed at tackling the nationwide housing crisis.
The new rules are set to come before the Oireachtas at the beginning of February.
Minister for Housing Darragh O'Brien announced the new regulations which will also allow pubs to change from commercial to residential without planning permission from next month.
Why introduce this grant?
The news is part of a strategy to tackle the ongoing housing crisis all over the country, particularly in major cities such as Dublin, Limerick, and Cork where vacant and derelict buildings could be repurposed as residential units.
The aim of the new grant is twofold: to provide more assistance to first-time buyers (especially those struggling to find properties in their price range), and to tackle the issue of vacant and derelict properties which are a blight on many towns and cities nationwide.
A residential buildings report from GeoDirectory revealed that there are now more than 100,000 vacant and derelict homes across the country - 90,158 vacant residential dwellings and 22,096 derelict residential addresses.
However, despite this new grant being announced, it won’t necessarily make it easier for people to get a mortgage.
Getting a mortgage on a derelict property
There are still a number of variables in relation to the proposed new grant for first-time buyers.
One point to consider is that just because you’re eligible for the above grant doesn’t mean a mortgage lender will be happy to give you a loan. We don’t yet know how willing lenders are going to be to lend against derelict properties.
When trying to secure finance for a new home as a first-time buyer, it’s important to remember that you’ll be underwritten twice in the mortgage approval process - firstly on your income and secondly, on the property you’re looking at purchasing.
That is to say, some mortgage lenders may not approve the latter end of the underwriting process based on the property that’s being proposed.
Another important point prospective homeowners need to consider is that if you’re thinking of turning a derelict property into the home of your dreams, you’ll need to hire the relevant tradespeople, which is fairly tough right now to say the least.
Is this a good proposition?
Only time will tell how effective the new grant will be, however it’s clear the grant favours those who have more money and time on their hands.
Not every first-time buyer will be in a position to be able to afford to renovate a property, nevermind have the time and energy it takes too, especially families working on a budget.
Nevertheless, any measure that will help towards repurposing otherwise vacant and derelict buildings is welcomed.
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What do you think of the latest grant for first-time buyers? Would you consider purchasing a derelict property? Let us know in the comments below!