LOCAL authorities will spend at least €7.5m this year paying interest and security costs on vacant buildings in the affordable-homes scheme.

Of the estimated 1,500 affordable homes that are unoccupied, about 500 each are in the Cork county council and Dublin city council areas. Cork is spending an average of €50,000 a month on security to prevent empty homes in isolated locations being vandalised. Fingal council, which has 300 unsold units for sale at less than €205,000 each, is paying for security on five of its 24 developments.

“The feedback I’m getting from our members is that affordable homes are often vacant up to a year later because they haven’t been allocated or taken up by applicants,” said Martin Whelan of the Irish Home Builders’ Association. “There will always be demand for social housing, but there is a suspicion that local authorities are exaggerating it. Some authorities, like Carlow, have even begun to reduce demand.”

Despite demands from some of the social partners for an increase in affordable-housing supplies, there is a lack of uniformity between local authorities in how they manage and market properies, according to builders. Some authorities do not hand over the housing list to the developer until all the units are complete. It then holds individual viewings, which takes up to a month to arrange, instead of taking advance bookings for group viewings.

Buyers and banks are also being blamed for the slow take-up. Some low- and middle-income earners have taken on so much credit-card and personal debt that they no longer qualify for mortgage approval. Others are said to be demanding better located, larger homes. In Cork, buyers have rejected mid-terrace houses, and want areas such as Glanmire rather than near Macroom, a local official said.

Banks are lending just 80% of the cost of affordable homes, compared with 100% two years ago, and are more reluctant to give home loans to low earners.

A more recent problem is that affordable homes are now competing with the open market, where a slump in prices has made houses more accessible to first-time buyers. Buying a standard home means owners don’t have to worry about the affordable-home restriction which involves repaying the local authority if the house is sold in 20 years.

John O’Connor, chief executive of the Affordable Homes Partnership (AHP), which is charged with procuring units for schemes in the greater Dublin area, said: “We’ve been doing a lot of work with local authorities to make sure their affordable homes are 15% to 20% below the market value of similar homes in the locality to make them more attractive.”

The AHP held talks recently with industry, financial and government figures to draw up a financing mechanism to attract more eligible property buyers to affordable-housing schemes. “If it’s appropriate for the US government to buy AIG and for our government to intervene in the banking system, then it’s equally appropriate for the government to intervene in the housing system,” said Whelan.

Times Recommends

• The Japanese Prime Minister is doomed: or is he?
• Brighton company 'involved in cyber attack'
• The art of survival: it's all in the mind