Under the scheme, councils will have to advertise vacant properties online and those on the housing waiting list will express their preference for the type of home they need on the list.
Sinn Féin TD and spokesperson on Housing, Planning, Community and Local Government Eoin Ó Broin welcomed the announcement.
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He said: "The scheme works because it gives local authority tenants ownership over their housing needs. It is beneficial for the council as it does dramatically reduce the number of refusals.
"The expansion of this scheme was one of the key recommendations of the committee report on housing and homelessness. However the expansion of this scheme alone will not have any dramatic impact on housing waiting lists. We need to see the government increase the supply of housing in order to make a dent in the 140,000 plus housing list."
(CD/MH)
