HBFI reports busiest 6 month period for loan approvals
The state agency established to help fund the delivery of new homes grew loan approvals to €1.16bn at the end of June 2022.
That was an increase of 38% on the €835 million approved by the end of 2021.
It was Home Building Finance Ireland’s busiest ever six-month period based on loan approvals.
HBFI was established to with a remit to provide funding at market rates for commercially viable residential developments.
It came about in response to the housing supply shortage that has seen supply falling well short of estimated demand.
The agency has now committed almost 60% more than the €730 million of capital that was originally allocated to it when it was established three and a half years ago.
It generates lending capacity from recycling the proceeds from existing loan repayments.
HBFI also has the ability to access additional capital through market-based borrowing if required.
“We remain vigilant to risks such as construction price inflation, but we will work closely with the housebuilding firms we lend to in helping them address these challenges and continue adding to the supply of new homes,” Dara Deering, Chief Executive of HBFI said.
“We’re also delighted that we’ve expanded our footprint into 2 more counties – Kilkenny and Limerick – bringing the total to 20 the number of counties in which we’ve approved funding,” she added.
By the end of June, HBFI had approved funding for 5,210 new homes in 86 developments in 20 counties.
Social housing projects account for almost a quarter of the new homes approved for funding.
715 HBFI-funded units have already been completed and sold, with a further 1,783 contracted for sale or sale agreed.
Of the €1.16 billion approved, drawdowns totalling €737 million have taken place, for 50 developments with 3,229 units where construction is in progress or has completed.
HBFI typically expects a time lag of between 3 and 6 months between a loan being approved and its first drawdown.
Units funded by HBFI range from one-bed apartments (13%) to 5-bed houses (2%), with the majority consisting of 3 bed (38%) and 2 bed (30%) units aimed at the first-time buyer market.
Individual loan facilities range from €1 million to €94 million, with an average size of €13 million.
Loan terms range from 6 months to 48 months, with an average of 22 months.