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Up to €50m in bank loans and levies to pay for repair of pyrite homes

Environment Minister Phil Hogan has announced the setting up of the Pyrite Resolution Board which will aim to give thousands of homeowners by the issue a long-awaited resolution.

Cracks in the wall of a house affected by pyrite damage.
Cracks in the wall of a house affected by pyrite damage.
Image: James Horan/Photocall Ireland

THE GOVERNMENT HAS announced a scheme to help homeowners affected by pyrite with a new Pyrite Resolution Board to oversee the implementation of remediation works on the thousands of homes affected.

Environment Minister Phil Hogan announced today that banks will provide loans totalling as much as €50 million to a special fund that will assist homeowners affected by the problem.

A levy will also be placed on certain building materials such as stone and non-health insurance policies to meet the costs accrued from the scheme. The details of this have yet to be finalised.

Pyrite is a mineral compound that naturally occurs in rock but can swell and produce crystals when it comes into contact with oxygen and moisture.

During the property boom, infill containing high levels of pyrite was used in the construction of buildings. This has led to around 12,250 ground floor dwellings experiencing problems with cracking walls and floors due to problems caused by pyrite.

Of these, a report from a panel that was set up by Environment Minister Phil Hogan found that around 850 dwellings were in need of immediate remediation as of March this year.

Allowing for an increase since March, it is estimated 1,000 dwellings are currently in need of remediation while there are a further  10,000 ground floor dwellings in 74 estates where pyrite has been identified.

The scheme will see homes that are damaged by pyrite repaired first before homes where pyrite is found to have been present are dealt with. The Pyrite Resolution Board will determine how much money homeowners are entitled to from the fund.

Levy

The announcement today is acting on the recommendations contained in the Pyrite Panel’s report in July of this year which involved input from the Construction Industry Federation, the Irish Concrete Federation, HomeBond and the Irish Banking Federation.

These stakeholders could not agree a voluntary mechanism for funding repairs but the Department said that there was an “almost universal acceptance” that remediation process must be in place that does not involve homeowners meeting the costs of repairs.

In its report, the Pyrite Panel said that the average cost of remediation for a typical home would be in the region of €45,000.

“While no agreement could be reached on a voluntary funding mechanism, the stakeholders have agreed in principle on a mechanism that will facilitate the remediation of dwellings affected by pyrite in accordance with best international practice,” the Department of Environment said.

Hogan said in a statement: “While much work remains to be done to complete the jigsaw, I am confident that the end is now in sight for affected homeowners.  Today’s decision provides a detailed roadmap of how that is going to be achieved.”

In a statement, the Construction Industry Federation (CIF), said it supported the initiative taken by the government but criticised the levy which is going to be applied to certain building materials.

“It is unfortunate that the industry must now pay a price with a levy on aggregates which will drive up costs for industry and procurers of new infrastructure,” the CIF said.

“The levy on construction materials will add to costs in an industry that is already struggling.  It will be necessary to ensure that this levy is not implemented indefinitely so that it does not become a general tax on the construction industry.”

Read: Noonan says pyrite homes will be exempt from property tax

Column: ‘We’re watching our first house crumble before our eyes’

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Hugh O'Connell

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