Irish Property Market 2020 Part 2

PropQueries

Bass Reeves wrote: »

I think you did not read my post. Read it again and again after than and then think before replying

I think I did. You implied that the cost of building houses that Cairn Homes presented to their investors may be due to them hiring directly.

You stated "Cairns may be actually managing the site themselves with no or minimum use of subbies. Subbies will need a 20% margin to operate."

So, the reason for Cairn Homes being able to build their 1000 sq.ft. A-Rated semi-detached houses for an average of c. €100k is not down to cost savings made by hiring labour directly as they make extensive use of sub-contractors.

brisan

Bass Reeves wrote: »

It actually a very clear reason why the state should not give open ended commitment at tendering. It was a brown field site. And prices are virtually on time and materials. It was a design contract. The companies building it will complete millions of euro's of work before they receive payment. It has defined stages that payments are made at same as road building.

If a similar process is put in place for house building as the NCH expect hen houses to cost half a million

As I said developers know what it costs to develop a site and build houses .
Cost plus margin and no over runs with stage payments
No financing costs ,no EA costs .guaranteed buyers ,no waiting around for the last few to sell and snag them
We seem to great at finding problems in this country ,not great at solutions
Only issue I can see is maybe developers want bigger margins than they say and maybe its not as expensive to build a house as they say

Bass Reeves

PropQueries wrote: »

I think I did. You implied that the cost of building houses that Cairn Homes presented to their investors may be due to them hiring directly.

You stated "Cairns may be actually managing the site themselves with no or minimum use of subbies. Subbies will need a 20% margin to operate."

So, the reason for Cairn Homes being able to build their 1000 sq.ft. A-Rated semi-detached houses for an average of c. €100k is not down to cost savings made by hiring labour directly as they make extensive use of sub-contractors.

I did no such thing read the post again

PropQueries

Ok, so we have Cairn Homes stating that the cost of building each of their 1000 sq.ft. A-Rated three bed semi-detached units is c. €100k.

We also have developers in Waterford selling A-Rated two bed terraced houses for €165k.

I think we can all agree that the cost of building a house in Dublin is not anywhere near the €400k figure the DCC’s head of housing recently stated on the Pat Kenny show?

Graham

PropQueries wrote: »

Ok, so we have Cairn Homes stating that the cost of building each of their 1000 sq.ft. A-Rated three bed semi-detached units is c. €100k.

No. We don't.

Cyrus

PropQueries wrote: »

Ok, so we have Cairn Homes stating that the cost of building each of their 1000 sq.ft. A-Rated three bed semi-detached units is c. €100k.

We also have developers in Waterford selling A-Rated two bed terraced houses for €165k.

I think we can all agree that the cost of building a house in Dublin is not anywhere near the €400k figure the DCC’s head of housing recently stated on the Pat Kenny show?

what was included in the 400k? because its not comparable to your 100k thats for sure.

what do you think a site costs for one of these houses? site costs?

PropQueries

Cyrus wrote: »

what was included in the 400k? because its not comparable to your 100k thats for sure.

what do you think a site costs for one of these houses? site costs?

We're debating on the actual cost to councils building directly on council owned land and if they built their units at a similar cost base to Cairn Homes.

The article on the €400k figure is here: https://www.independent.ie/life/home-garden/dublin-city-councils-wine-into-water-housing-policies-39767811.html

Browney7

Cyrus wrote: »

do the state provide funding for the projects? fair enough if so.

also we are comparing 70 sqm 2 beds in waterford to 90 sq/m in dublin, and costs are always going to be higher in the main cities than the regional ones.

They effectively are - Activate Capital is backed the ISIF who in turn lend to the developer who builds on the site and then enters into an enhanced lease agreement with the council at a chunky gross yield. The state gets an awful deal long run but gets to keep debt off the national debt and instead accrue a much larger ongoing liability as current expenditure via HAP. Its an awful waste of tax revenue considering the state can borrow for 20 years for near 0%

PropQueries

Browney7 wrote: »

They effectively are - Activate Capital is backed the ISIF who in turn lend to the developer who builds on the site and then enters into an enhanced lease agreement with the council at a chunky gross yield. The state gets an awful deal long run but gets to keep debt off the national debt and instead accrue a much larger ongoing liability as current expenditure via HAP. Its an awful waste of tax revenue considering the state can borrow for 20 years for near 0%

Well, Cairn Homes over the summer, lobbied the government "for funding for a new, long-term affordable rent initiative" proposal.

To me anyway, and people can up their own mind by reading the article below, I think this would show that the developers now believe there's much more profit to be made in renting to the state or renting to people with support from the state than renting or selling into the private market.

The link to the article in the Irish Examiner is here: https://www.irishexaminer.com/business/economy/arid-40139519.html

Villa05

Bass Reeves wrote:

Since 2015 material and labour costs have probably gone up 50%. It easy to pick a figure out of your ar5e and decide its gospel.

The irony

brisan

Villa05 wrote: »

The irony

Wages have not gone up by anything remotely nearing those figures
https://www.statista.com/statistics/416212/average-annual-wages-ireland-y-on-y-in-euros/
https://www.google.com/search?safe=active&rlz=1C1GCEB_enGB889GB889&ei=fUXKX8_qO6K3gwe8pYioCg&q=average+industrial+wage+ireland+2020&oq=aveerage+industrial+wage+ireland+2020&gs_lcp=CgZwc3ktYWIQARgAMgQIABATOggIABAWEB4QE1DlMVj0QGDbSWgBcAB4AIABxwKIAZMHkgEHMS4xLjAuMpgBAKABAaoBB2d3cy13aXrAAQE&sclient=psy-ab

5 TO 6 % at most

Hubertj

brisan wrote: »

Wages have not gone up by anything remotely nearing those figures
https://www.statista.com/statistics/416212/average-annual-wages-ireland-y-on-y-in-euros/
https://www.google.com/search?safe=active&rlz=1C1GCEB_enGB889GB889&ei=fUXKX8_qO6K3gwe8pYioCg&q=average+industrial+wage+ireland+2020&oq=aveerage+industrial+wage+ireland+2020&gs_lcp=CgZwc3ktYWIQARgAMgQIABATOggIABAWEB4QE1DlMVj0QGDbSWgBcAB4AIABxwKIAZMHkgEHMS4xLjAuMpgBAKABAaoBB2d3cy13aXrAAQE&sclient=psy-ab

5 TO 6 % at most

Is the CSO chart not showing an increase of about 15%ish since 2015?

JimmyVik

PropQueries wrote: »

Ok, so we have Cairn Homes stating that the cost of building each of their 1000 sq.ft. A-Rated three bed semi-detached units is c. €100k.

We also have developers in Waterford selling A-Rated two bed terraced houses for €165k.

I think we can all agree that the cost of building a house in Dublin is not anywhere near the €400k figure the DCC’s head of housing recently stated on the Pat Kenny show?

Must get those builders numbers

Do you know much would it cost you to get a 40 sqm extension build on to an existing house you already own.

brisan

Hubertj wrote: »

Is the CSO chart not showing an increase of about 15%ish since 2015?

Only checked the average industrial wage figures
Even at 15% it’s still a long way off 50%
Most of my mates are in construction and they have got nothing like a 50% rise
even the self employed ones

JimmyVik

brisan wrote: »

Only checked the average industrial wage figures
Even at 15% it’s still a long way off 50%
Most of my mates are in construction and they have got nothing like a 50% rise
even the self employed ones

Opposite experience here.
Most of my mates the same.
And they are minted now. Well they werent for a while with covid because they were out of work, but before it and even now they are easily doing 50% better than they were in 2015. At least any with skills better than labouring are.

brisan

JimmyVik wrote: »

Must get those builders numbers

Do you know much would it cost you to get a 40 sqm extension build on to an existing house you already own.

Do you know the profit a builder makes on an extension that size ?

Marius34

Everything has a value in open Market.
Government controlled land is not free, it has a Value.
I do understand the use of "free" land for social housing. I don't understand the use of "free" for affordable housing. If that's in Dublin county you probably handing out 100K Eur. worth of land to someone, while others a paying for it.

PropQueries

JimmyVik wrote: »

Must get those builders numbers

Do you know much would it cost you to get a 40 sqm extension build on to an existing house you already own.

Here you go. Get his contact details and see what price he will offer you.

Link here to a developer selling a-rated two bed terraced houses in Waterford for €165k: https://www.myhome.ie/residential/brochure/two-bed-terraced-radharc-na-siuire-knockboy-grantstown-waterford-city-waterford/4437860

JimmyVik

brisan wrote: »

Do you know the profit a builder makes on an extension that size ?

Do tell?

PropQueries

Marius34 wrote: »

Everything has a value in open Market.
Government controlled land is not free, it has a Value.
I do understand the use of "free" land for social housing. I don't understand the use of "free" for affordable housing. If that's in Dublin county you probably handing out 100K Eur. worth of land to someone, while others a paying for it.

Well then you should be concerned at RTE selling off a parcel of "their" land for c. €100 million in 2017. Wouldn't that land have been put to better use to house people on the waiting list? I don't think the current RTE staff got together and purchased it in the past 50 years. Why should they be the sole beneficiaries from the sale of state owned land?

brisan

JimmyVik wrote: »

Do tell?

At least 40% of the quoted price and the extras are the cream on top
Dermot Bannon has lads quoting 300k fir a refurb and an extension and there again you have builders buying the land and building a 3 bed A rated 100sq mt semi for a little over 200k
The only small builders are those under 5 ft 10 inches in height

Marius34

PropQueries wrote: »

Well then you should be concerned at RTE selling off a parcel of "their" land for c. €100 million in 2017. Wouldn't that land have been put to better use to house people on the waiting list? I don't think the current RTE staff got together and purchased it in the past 50 years. Why should they be the sole beneficiaries of state owned land?

I don't know anything about RTE staff, or what they got free. I don't see anything free here? Someone paid 100mil, doesn't look free from your comment.
And I'm not against using government land for social housing. I didn't say anything like that in my comment.

JimmyVik

brisan wrote: »

At least 40% of the quoted price and the extras are the cream on top
Dermot Bannon has lads quoting 300k fir a refurb and an extension and there again you have builders buying the land and building a 3 bed A rated 100sq mt semi for a little over 200k
The only small builders are those under 5 ft 10 inches in height

We did a 40sqm one 3 years ago between myself 2 brothers (Well one brother and my dad did most of the skilled work tbh) and my

Dad. We had to hire in some skills that we couldnt do.
Anyway total cost came to €44K and that was without anyone getting a profit from it as it was on a relatives house.

We've done some on flipped renopvations between us over the last 10 years. They are getting more expensive all the time.

brisan

JimmyVik wrote: »

We did a 40sqm one 3 years ago between myself 2 brothers (Well one brother and my dad did most of the skilled work tbh) and my

Dad. We had to hire in some skills that we couldnt do.
Anyway total cost came to €44K and that was without anyone getting a profit from it as it was on a relatives house.

We've done some on flipped renopvations between us over the last 10 years. They are getting more expensive all the time.

Labour is getting more expensive ( not by much ) most raw materials are either steady or barely increasing in price
We bought our final house last year
Builder had a price of 275 in for work
He had received a 20 k deposit so we had to get that much out of him
We did it ourselves bigger to a much higher standard with a lot of extras ( extra bathroom heat pump , underfloor heating etc ) for a lot less
Small builders make a big profit on extensions , don’t kid yourself on anything else
If a plumber quotes 4K to a builder for the job the builder will quote at least 6k to the client , it’s the way it always has been

Pixlated Potatoe

If it costs 300k to build a house plus land cost ,plus profit then these houses are worth 4-500k all day long
Houses are not overpriced

Hubertj

Is part of the conspiracy theory also that construction costs such as materials are being artificially inflated? Is it part of the master plan to enrich the elites and “landlord classes”?

Haven’t heard people pipe on about construction inflation but no doubt there are some plausible arguments that it is all a con job on the Irish people.

PropQueries

Pixlated Potatoe wrote: »

If it costs 300k to build a house plus land cost ,plus profit then these houses are worth 4-500k all day long
Houses are not overpriced

But how are developers in Waterford selling a-rated 2 bed terraced houses for €165k?

Villa05

Pixlated Potatoe wrote:

If it costs 300k to build a house plus land cost ,plus profit then these houses are worth 4-500k all day long Houses are not overpriced

Funny that so many houses sell for below that price.
Maybe we need to do a collection for all those losses

Stopitwillya

PropQueries wrote: »

But how are developers in Waterford selling a-rated 2 bed terraced houses for €165k?

That house is not far from where I live. A really nice part of Waterford City with 2 fine primary schools, a secondary school and ballygunner gaa club all within 200 metres of that house. Very good value. Prices in Waterford City are likely to rise over the next 10 years due to significant investment in the city over the next 4 years.

Who2

brisan wrote: »

Labour is getting more expensive ( not by much ) most raw materials are either steady or barely increasing in price
We bought our final house last year
Builder had a price of 275 in for work
He had received a 20 k deposit so we had to get that much out of him
We did it ourselves bigger to a much higher standard with a lot of extras ( extra bathroom heat pump , underfloor heating etc ) for a lot less
Small builders make a big profit on extensions , don’t kid yourself on anything else
If a plumber quotes 4K to a builder for the job the builder will quote at least 6k to the client , it’s the way it always has been

Glass has increased 10% in the last 2 months, timber is up 20% wavin the same as is plasterboard , if they are small increases then fair enough but in my mind I’d classifiy them fairly substantial . They are just some of the basics don’t start looking into the more complex parts of construction. There is still a huge backlog on imports. Builders margins usually run at 7-15% of trade prices so don’t kid yourself thinking they are cleaning up.