Two Statutory Instruments have been published relating to the Affordable Housing Act 2021 (the Act):
1. SI No. 424 of 2021: Affordable Housing Act 2021 (Commencement) (Parts 1 and 3) Order 2021
This appoints 19 August 2021 as the commencement date for Part 1 (Preliminary and General) and Part 3 (Cost Rental Dwellings) of the Act; and
2. SI No. 425 of 2021: Affordable Housing Act 2021 (Cost Rental Designation) Regulations 2021
These regulations provide for the process whereby the owner of a dwelling can apply to the Minister for Housing, Local Government and Heritage to have that dwelling designated as a cost rental dwelling under Part 3 of the Act. Their provisions can be summarised as follows:
Application for designation as a cost rental dwelling is to be made to the Minster for Housing (the Minister). An owner can apply for the designation of multiple dwellings under the one application. An application cannot be formally submitted in advance of the applicant acquiring title to the property.
The applicant must declare:
- that they will comply and will take all reasonable sets to procure that their successors in title will comply with the obligations of an owner of a cost rental dwelling under Part 3 of the Act; and
- that all factual statements contained in their application are true and correct to the best of the applicant’s knowledge, information and belief and that the applicant has taken all reasonable measures to confirm that the information provided is true and correct as at the date of the application.
Any application must be accompanied by documentary evidence to establish:
- The applicant’s title, which in the case of lease must mean that the remaining term must be equal to or exceed the minimum cost calculation period (40 years). This is to be evidenced by either a certified copy folio or a certified copy of the deed to the owner;
- Any incumbrances affecting the dwelling;
- The written consent of the holder of any estate or interest in the dwelling or any incumbrancer (the form of which is provided for in Schedule 4 to the Regulations, as replicated at Appendix 4 to this memo);
- The estimated market rent for the dwelling, to be evidenced by a statement provided by a person licenced to provide letting services under the Property Services (Regulation) Act 2011;
- The capital costs incurred in acquiring, developing and otherwise making available the dwelling for designation as a cost rental dwelling on the indicative designation date;
- The funding arrangements for meeting the capital costs; and
- The arrangements for payment of any costs to be incurred in financing expenditure to meet the capital costs, including fees and interest payments incurred through debt financing.
The application must include a cash-flow statement showing the estimated rental income and estimated expenditure for each year of the proposed arrangement.
Additional information can be requested by the Minister. Where such additional information is provided, the applicant must make a revised declaration that all factual statements contained in the application are true and correct to the best of the applicant’s knowledge, information and belief and that the applicant has taken all reasonable measures to confirm that the information provided is true and correct as at the date of the application.
Cost rental designation
Once the application has been successfully processed and approved, the applicant will receive a cost rental designation document.
Where the owner is happy to proceed with the cost rental designation of the dwelling on the basis of the details set out in Part A of the cost rental designation document (which includes details of the minimum cost rental period, the cost calculation period and the initial maximum rent), they are required to signify their consent by completing part B of the document and returning it to the Minister within 7 days.
Where the owner is not satisfied to proceed, they can request that the Minster amend certain details in the document (what these details are is unspecified in the Regulations).
Once the Minister’s seal has been applied to the document, the designation is complete.
For further information on this topic, please contact Aoife Smyth, Knowledge Lawyer or any member of A&L Goodbody’s Real Estate team.