Irish Property Market chat II - read mod note post #1 before posting

hometruths · 02-09-2024 07:12PM

https://www.boards.ie/discussion/comment/122575550#Comment_122575550

The bike shed is a good example of a job that should have been able to be handled in house by the OPW, and instead the taxpayer got fleeced by outsourcing it.

The state is already getting ridden by private companies in the quest for housing - whether it's the delivery of "affordable" homes on state land, eg Oscar Traynor, or Part V purchases for social housing, or long term leases, and many other examples, there is no shortage of snouts in the trough currently.

In any event, my enthusiasm for the state to cut out the middlemen is more to do with removing the state from its role as marginal buyer in the private market, than some kind of delusion that politicians and civll servants are prudent with public funds. If they can reduce the contagion of the problem then that will be an improvement.

extra-ordinary_ · 02-09-2024 07:14PM

https://www.boards.ie/discussion/comment/122575550#Comment_122575550

No no…anyone seen to be ripping of the nations coffers gets kneecapped.

Bass Reeves · 02-09-2024 07:21PM

Over 8k vacant properties have applied for the VH grant and over 5k have been approved. It started 18 months ago so we are looking at 5k+ houses/ year will be in the scheme costing the state on average slightly above 50k/unit

If we hit 35k+ ish new units we are looking effectively about 40k houses a year. Yes some of these houses would have been refurbished anyway over time but the grant is speeding up the process

https://www.farmersjournal.ie/news/news/over-8-000-applications-to-the-vacant-house-grant-822565

02-09-2024 07:46PM

https://www.boards.ie/discussion/comment/122575606#Comment_122575606

No, it really won’t. If the Government become property developers, they will either have to compete with the private sector for construction workers, or pay private developers to do the job. Either way, the State gets fleeced. If the State directly employs the builders, they will become public servants, with employment rights and about as much incentive to work more quickly or efficiently as any other PS. If they get a better offer in the private sector, they leave. If private developers are employed for projects worth billions, they will carve up the Dept in charge like a turkey at Christmas.

If I were one of the property developers whose expertise for large scale construction projects the State would need to build on that scale, I’d be sincerely hoping your/SFs plan comes to fruition, I’d want as big a chunk of that 39Bl as I can get.

Villa05 · 02-09-2024 07:49PM

https://www.boards.ie/discussion/comment/122575550#Comment_122575550

Thanks for the summary results of 100+ years of FFG governance

combat14 · 02-09-2024 07:54PM

so where is the 39 billion coming from to fund these houses - is SF planning income and property tax rises, will they be as bad as the greens.?

hometruths · 02-09-2024 08:27PM

https://www.boards.ie/discussion/comment/122575737#Comment_122575737

I'm under no illusion that there would be wastage.

The argument against it seems to focus on the valid point that billions will be pissed away.

My hope would be at least in pissing away billions the situation might improve.

Currently we're pissing away billions and the situation is worsening.

I struggle to see the logic in wanting to continue that strategy.

02-09-2024 09:11PM

https://www.boards.ie/discussion/comment/122575892#Comment_122575892

You want 100% of the risk, cost and responsibility to be absorbed by the State? That would be utter madness.

If you want properties built quickly, you incentivise the private sector to do it.

hometruths · 02-09-2024 09:33PM

https://www.boards.ie/discussion/comment/122576046#Comment_122576046

I want 100% of the risk, cost and responsibility for social housing to be absorbed by state, yes. Which appears to be pretty much the status quo anyway.

As regards the provision of affordable housing on state owned land, the recent Oscar Traynor situation is a timely example of the current problem of how successful outsourcing the risk, cost and responsibility has been.

The state sold the land at a massive discount to market value, and ended up with affordable houses in Coolock that cost almost 500k. The affordable definition only applies because the state is taking a further risk, cost and responsibility of up to 30% of the equity.

That's utter madness.

And a state backed building firm mitigates the risk of being held over a barrel by the construction industry who threaten to stop building if subsidies dry up.

And none of the above necessarily stops private sector properties being built by incentivising private sector construction if needs be. I don't see why the two cannot coexist.

Villa05 · 02-09-2024 09:36PM

https://www.boards.ie/discussion/comment/122575765#Comment_122575765

The spending on housing is currently running at 8billion p/a.

39 billion over 5 years would represent an improvement in outgoings

Villa05 · 02-09-2024 09:44PM

https://www.boards.ie/discussion/comment/122576046#Comment_122576046

Where are you getting 100% of the risk on the taxpayer. The private sector does not go into hibernation for 5 years

If you had a solid pipeline of public housing, say 10k per anum. The private sector would ramp up there output to get it out ahead of the public sector, you could get a temporary supply surge, exactly what the market needs

combat14 · 02-09-2024 09:55PM

https://www.boards.ie/discussion/comment/122576159#Comment_122576159

they must be going to cut the HAP scheme so

hometruths · 02-09-2024 09:56PM

https://www.boards.ie/discussion/comment/122576159#Comment_122576159

The €39 billion caught my as eye as it is more than the figure the Irish Times recently reported it would cost the State to build new homes for both everybody on a social housing waiting list and everybody currently receipt of HAP - €35 billion.

The report calculates that it would cost the State €17.55 billion to build new, appropriate, permanent social housing for every household currently on the social housing waiting lists as well as a further €17.40 billion to construct the same for every household in receipt of HAP.

So if a government were to throw €39 billion at those two specific problems, removing them from private sector, it would have an enormous impact on the wider problems of affordability in private sales and rental markets.

There may be some some short term pain in diverting the resources but the long term benefits would be worth it.

https://www.irishtimes.com/ireland/housing-planning/2024/08/19/report-estimates-it-would-cost-nearly-35bn-to-build-social-housing-for-all-those-in-need/

Bass Reeves · 02-09-2024 10:23PM

https://www.boards.ie/discussion/comment/122576237#Comment_122576237

So the IT thinks 35 billion to house 115k households so a out 300k/ household,now large section would be one and two owrson households, it would not be all three bed units. Average costs slightly over 300k that is accross 115k one, two and three bed + units.

SF is saying 300k houses for 39 billion. Sorry it dose not add up at 130k per unit. What SF is doing is taking away State land value, as well as stamp duty, income tax and vat reciepts. The problem is the real cost is 2.5 times that , and that is if they can be as efficient as the private sector.

It's show you the value the government is getting from HAP which gas a gross cost of about 800 million. You are looking a 20+ year pay back factor off gross cost....…and the LL maintains the property

hometruths · 02-09-2024 10:33PM

https://www.boards.ie/discussion/comment/122576314#Comment_122576314

I don't think Sinn Fein are saying they will build 300k houses at a cost of 39 billion.

They are saying they expect 300k houses to be built over the course of a government term - 60k a year.

most of these will be private houses, built and bought by the private sector.

their total budget for housing over the term will be 39 billion yes, but that's not all spent directly on building houses.

Montys return · 02-09-2024 10:44PM

I'm not taking a party perspective here, but before anyone tears out of the blocks to criticize the SF plan could they at least read an article about it?

That's all I've done and yet I know that:

● 39 Billion is for social and affordable housing of which they say there would be 125,000 and not 300,000

● Doherty said there would be no increase in taxes or debt raising to fund. They would instead divert the current allocation to the states new long term investment funds to the housing budget instead.

Now...at least you're slightly more informed.

dasa29 · 02-09-2024 11:10PM

Here are Summary of Social Housing Assessments 2023 on Household sizes.

you will see we need 35,872 One Beds Alone for 1 Adult and Couple as that is all they get from their councils.

03-09-2024 07:40AM

https://www.boards.ie/discussion/comment/122576189#Comment_122576189

100% of the responsibility, cost and risk for building houses provided by the aforementioned State Building Company. If there is 39bl in the fund, the waste will be monumental. Builders, builders suppliers etc will be licking their lips. The State building company would be competing with the private sector for the same pool of workers/trades, so no doubt would have to either pay more, or give employment benefits not currently available to labourers/tradesperson. The private sector would be building houses for those not entitled to buy the affordable housing, and charging a higher price because they will also be competing with the State for those workers, they may wind down their developments. If I were a construction worker, I would take the State job, and then do what public servants do, just enough. Private developers need to build as fast as possible, as cheaply as possible because time is money and the higher the cost, the less profit. No such requirements apply in the Public Sector.

Lorcan Nyon just put it into perspective on Ireland AM, there is currently a 3 bed house for sale in Dublin for less than that 18 birth Perspex bike shed. There are reports on the radio shows this morning that the parts of the shed can be sourced online for a total cost of 7k, I can’t say if they are the same materials.

03-09-2024 08:24AM

I'm not sure SF are going to attract the middle Ireland vote by promising a couple hundred thousand units of social housing @ 300k which they won't be eligible for

markodaly · 03-09-2024 09:42AM

https://www.boards.ie/discussion/comment/122575318#Comment_122575318

I am not a huge fan of the First Home Scheme or the Help to Buy Scheme, but they make more sense than the plan to sell houses to people at 250k but the buyers dont own the land, nor are they free to sell the property back on the open market.

They are better off having the state build these houses and getting people into an affordable long-term 10-20 year lease.

markodaly · 03-09-2024 09:44AM

https://www.boards.ie/discussion/comment/122575606#Comment_122575606

The bike shed is a good example of a job that should have been able to be handled in house by the OPW, and instead the taxpayer got fleeced by outsourcing it.

The OPW doesn't employ labourers, steel fabricators or builders on its books, so who could they have handed it 'in house'?

markodaly · 03-09-2024 09:47AM

https://www.boards.ie/discussion/comment/122575892#Comment_122575892

Currently we're pissing away billions and the situation is worsening.

Given that home building is up manyfold, that statement is just factually incorrect and not true.

I don't think you are debating this honestly

markodaly · 03-09-2024 09:54AM

https://www.boards.ie/discussion/comment/122576145#Comment_122576145

And a state backed building firm mitigates the risk of being held over a barrel by the construction industry who threaten to stop building if subsidies dry up

Also, something that may have been brought up before, but I am not sure that is legal by EU Law.

timmyntc · 03-09-2024 09:55AM

https://www.boards.ie/discussion/comment/122577052#Comment_122577052

How does HTB make more sense?

FHS is the state taking equity in your house which at least they will get back eventually (possibly)

But HTB is just a subsidy for private houses and once it's paid it's gone, the taxpayer will never recoup it. In this respect the separate affordable housing market proposed by SF does make sense as it develops an ever increasing pool of affordable homes. That is better value for state money

hometruths · 03-09-2024 10:06AM

https://www.boards.ie/discussion/comment/122577074#Comment_122577074

I guess if your only measure of success is an increase in volume of new builds then you can view it that the situation is improving.

Meanwhile:

Homelessness rising
Social housing waiting lists rising
HAP payments rising
Rental stock on market falling
Sales stock on market falling

I simply have a different opinion than you do of what is an improving situation. What is dishonest about that?

accensi0n · 03-09-2024 10:17AM

Why anyone would spend 1.4 mill on a house with a small tight front drive onto a busy road, I've no idea.

https://www.daft.ie/for-sale/detached-house-beaumont-lodge-beaumont-avenue-churchtown-dublin-14/5828401

Villa05 · 03-09-2024 10:29AM

https://www.boards.ie/discussion/comment/122576233#Comment_122576233

I'd imagine the objective would be to reduce HAP overtime as social housing increases.

markodaly · 03-09-2024 10:32AM

https://www.boards.ie/discussion/comment/122577102#Comment_122577102

Your argument doesn't make sense.

You complain that the HTB is a waste, as the taxpayer doesnt get it back.

Yet getting the state to build private houses on public land, that they cannot recoup, is a better deal?
Note, I can guarantee you that the state is going to fork out more than the 250k-300k on building those houses.

As I said, I am not a fan of either HTB, or FHS, BUT they seem much better than what SF are proposing.

They are better off keeping affordable housing on the state's books, and engaging in long-term leases. Instead, we have a Frankenstein model of private houses on public land where the buyer cannot sell in an open market.

markodaly · 03-09-2024 10:36AM

https://www.boards.ie/discussion/comment/122577136#Comment_122577136

I guess if your only measure of success is an increase in volume of new builds then you can view it that the situation is improving.

It is the most important metric, by far.

Do you concede the fact that home building is up substantially over the last few years?

Many of the other problems you cite are to do with the huge population increases. Do you think we should stop all and any migration into the country?

RichardAnd · 03-09-2024 11:00AM

https://www.boards.ie/discussion/comment/122577271#Comment_122577271

It's a metric, but by itself it cannot show whether the situation is improving or not. As you correctly point out, immigration is the cause of the issues listed. An increase in the completion of houses is of little help if there is a corresponding, or even greater increase in population.

A sensible approach to immigration would have avoided much of the problems we now face. Indeed, this has been known for years, but it has been ignored because it is politically and ideologically sensitive. Only in recent years has immigration become an openly discussed topic, and that's only because it became too large an issue to ignore.

If anything, this is why free and open discussion is vital.

Irish Property Market chat II - *read mod note post #1 before posting*

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Irish Property Market chat II - read mod note post #1 before posting