State Provision of Housing

PropQueries wrote: »

According to the Irish Times, plans to build more than 850 homes on a council site in Dublin have collapsed following the refusal of councillors to approve a deal with the developer Glenveagh Homes.

The council said it could be up to 8 years before the site could be developed again.

Surely they can just use the existing plans and start building the homes themselves, rather than waiting 8 years for whatever reason it would take that long?

Irish Times article here: https://www.irishtimes.com/news/social-affairs/plans-for-853-dublin-homes-collapse-after-councillors-refuse-to-approve-deal-1.4411010

Councils and public bodies don’t have the expertise. They could put it out to tender, take a couple of years to do it, make a balls of it as usual, go for lowest bidder, then make a balls of it again with cost and budget overruns.

Also why would they build it? You said they don’t need houses as there is no shortage and with prices falling 75% over the coming years it will be cheaper to wait and pick up bargains.

cnocbui wrote:

That isn't a small number, it's scarry. If you assume 3 people per dwelling, you are talking about 24,000 dwellings. If they could be provisioned at €250,000 apiece, that's €6 Billion needing to be bled from someone's vein.

That amounts to 6.74% of total government revenue collected in 2019. Imagine funding that from expenditure cuts, then Imagine increasing government taxation by that for one year to pay for it to happen in a short time frame.

Your analysis neglects to mention that close to a billion a year is spent on housing subsidies annually. This figure is rising considerably yoy.
Increasingly this money is going to Reits who pay little or no tax. Current Government policy commits us to this rising expense each year through long term leasing

In an age of close to 0% interest rates (free money) it would be a no brainer to build our own social and affordable housing. Doing so would pay for itself within 8 years and that's asumming that the occupants of these houses would not be paying anything towards it. I would envisage that the occupants on average would be paying sufficient rent to cover costs based on the savings from current market rents

Increasing supply would put downward pressure on private rents allowing people to save their deposits for their own homes quicker and allow them more cash in their pockets to spend in the local job creating businesses. The improved environment for house purchasers may allow for the phasing out of the FTB grant delivering further savings for the tax payer.

Building our own social and affordable housing would be the equivilant of a 1 billion economic stimulus in the Irish national economy EVERY YEAR. Instead that money is going to Canadian teachers pension funds amongst others through current Govt policy.

Thats my blueprint for solving the housing issue. Implemented properly it could help to solve our own future pension crisis and go along way to helping achieve carbon emissions targets. Who thinks this is complicated or impossible?

Villa05 wrote: »

Your analysis neglects to mention that close to a billion a year is spent on housing subsidies annually. This figure is rising considerably yoy.
Increasingly this money is going to Reits who pay little or no tax. Current Government policy commits us to this rising expense each year through long term leasing

In an age of close to 0% interest rates (free money) it would be a no brainer to build our own social and affordable housing. Doing so would pay for itself within 8 years and that's asumming that the occupants of these houses would not be paying anything towards it. I would envisage that the occupants on average would be paying sufficient rent to cover costs based on the savings from current market rents

Increasing supply would put downward pressure on private rents allowing people to save their deposits for their own homes quicker and allow them more cash in their pockets to spend in the local job creating businesses. The improved environment for house purchasers may allow for the phasing out of the FTB grant delivering further savings for the tax payer.

Building our own social and affordable housing would be the equivilant of a 1 billion economic stimulus in the Irish national economy EVERY YEAR. Instead that money is going to Canadian teachers pension funds amongst others through current Govt policy.

Thats my blueprint for solving the housing issue. Implemented properly it could help to solve our own future pension crisis and go along way to helping achieve carbon emissions targets. Who thinks this is complicated or impossible?

The problem here the one of moral hazard say we have a couple Mary and Billy who have have played by the rules, got married, had kids but have low paying jobs but earn just enough to not be entitled to such a scheme as you have outlined and they see Barbara and Jeff who never worked a day never married Jeff ain't down as the baby daddy and does a few nixers on the side and Barb of course goes and gets all the freebies from nappies to a house and a better and bigger house than they have... How long will it be before the penny drops with Mary and Billy that its just not worth their while working, getting a divorce and Billy going into the black economy. Playing by the rules in this country gets you nothing except more taxation. This is the conundrum. Either give everyone some alleviation from paying rent/mortgages or just stop supporting all together and as some have said let the rental market drop its prices as according to some there are a lot of empty properties not being used.. Its very unfair that people who already pay for rents/mortgages out of after tax wages and then have to pay again to support others who have no intention of helping themselves

brisan wrote: »

As I have said numerous times it can be done but I doubt the will to do is there
Borrow 5 billion from the covid magic money tree
Build 25,000 houses on state land at 200,000 euro each (3 bed A rated houses )
Sell 20,000 to private homeowners at 250,000 to get your 5 billion back
5000 Social Houses
Rinse and repeat
For those that say it cannot be done at that price ,these builders had to buy the land and make a profit
Get private developers to do ,allowing no cost over runs and a guaranteed profit and sales for the developer

https://www.myhome.ie/residential/ireland/new-homes/property-for-sale?maxprice=250000&minbeds=3

thats all well and good but if you are building 25k houses thats a new large town (in an irish context) right there, to think the costs stop at 5bn is a little simplistic.

brisan wrote:

As I have said numerous times it can be done but I doubt the will to do is there Borrow 5 billion from the covid magic money tree Build 25,000 houses on state land at 200,000 euro each (3 bed A rated houses ) Sell 20,000 to private homeowners at 250,000 to get your 5 billion back 5000 Social Houses Rinse and repeat For those that say it cannot be done at that price ,these builders had to buy the land and make a profit Get private developers to do ,allowing no cost over runs and a guaranteed profit and sales for the developer

I think the potential benefits are far too great for it to be ignored. If the will is not there, change the people in power

fliball123 wrote:

The problem here the one of moral hazard

Said houses are not for sale. They are a state asset, purely for rental market. Affordable Rent set at a percentage of household income. Set up semi state management company to manage.

Villa05 wrote: »

Your analysis neglects to mention that close to a billion a year is spent on housing subsidies annually. This figure is rising considerably yoy.
Increasingly this money is going to Reits who pay little or no tax. Current Government policy commits us to this rising expense each year through long term leasing

In an age of close to 0% interest rates (free money) it would be a no brainer to build our own social and affordable housing. Doing so would pay for itself within 8 years and that's asumming that the occupants of these houses would not be paying anything towards it. I would envisage that the occupants on average would be paying sufficient rent to cover costs based on the savings from current market rents

Increasing supply would put downward pressure on private rents allowing people to save their deposits for their own homes quicker and allow them more cash in their pockets to spend in the local job creating businesses. The improved environment for house purchasers may allow for the phasing out of the FTB grant delivering further savings for the tax payer.

Building our own social and affordable housing would be the equivilant of a 1 billion economic stimulus in the Irish national economy EVERY YEAR. Instead that money is going to Canadian teachers pension funds amongst others through current Govt policy.

Thats my blueprint for solving the housing issue. Implemented properly it could help to solve our own future pension crisis and go along way to helping achieve carbon emissions targets. Who thinks this is complicated or impossible?

I would like to understand the Opex costs of managing a significant increasing in social housing stock. This needs to be factored into the business case over a 30-50 year period.

Hubertj wrote: »

I would like to understand the Opex costs of managing a significant increasing in social housing stock. This needs to be factored into the business case over a 30-50 year period.

I am sure the 1 billion (figure quoted here ) spent on housing and rent subsidies plus rent received would go a long way to paying any costs involved in managing he properties
The councils have experience of managing council ran estates,plus they own plenty of social housing in private estates

brisan wrote: »

Get private developers to do ,allowing no cost over runs and a guaranteed profit and sales for the developer

Any large current builder(not developer) that has had experience building council estates, would pick private over it in a heartbeat. Council builds are always decision by committee, which leads into massive cost over runs from ridicules demands and a inability to actually get paid on time since somebody has to put their name to something.

Besides, at least planning now accounts for external factors including the local services. Eg, no point in building a 5k housing estate when the road leading to it can't take the traffic, the public transport options are near non-existent, water and sewage systems are at or close to capacity, electricity grid the same and local schools are extremely overbooked. You can't build and leave it up to the council to sort out those issues now.

Fred Cryton wrote: »

There is no "housing crisis" outside particular pressure points in Dublin. Housing is reasonably affordable in the vast majority of the country.

And if there was a housing crisis, we certainly should not be looking to semi literate left wing DCC councilors to solve it.

This decision makes me laugh because the only people hurt by it are the young naive kids voting left hoping to get a cheap gaf, and instead nothing gets built at all. Maybe this will teach them a lesson? Can only hope.

You have obviously not visited the saving for a mortgage threads or any of the the other threads on buying or renting a property
They all tell a different story

Fred Cryton wrote: »

Actually i have - on a thread the other day saw a guy earning 37k, saving 800 a month and going to buy a home for 150k. As i said, housing reasonably affordable in vast majority of the country.



There's a certain child like dependency among a large cohort of Dubliners i think. No get up and go. If you can't afford Dublin, then move out.



The real scandal in this country is packing social housing onto prime expensive land in the city centre, at a cost of 500k+ per unit. Absolute disgrace.

Can you give me a reason why property in other parts of the country are considerably cheaper than Dublin
I am struggling to see why people from Dublin do not move to the country to buy cheaper house ,it makes sense to me
I mean why pay 400k for a house in Dublin when you can buy one in Leitrim for 150k
Seems to me Irish people have being doing it wrong for the last 100 years
Moving to Dublin to buy dear houses when they could have stayed put and buy cheap ones
I think you may be on to something with that idea


Oh wait there is Fcuk all jobs in the country and you will not get a mortgage without a job
That's why people want to live in Dublin

Fred Cryton wrote: »

Actually i have - on a thread the other day saw a guy earning 37k, saving 800 a month and going to buy a home for 150k. As i said, housing reasonably affordable in vast majority of the country.



There's a certain child like dependency among a large cohort of Dubliners i think. No get up and go. If you can't afford Dublin, then move out.



The real scandal in this country is packing social housing onto prime expensive land in the city centre, at a cost of 500k+ per unit. Absolute disgrace.

The opposite is happening ,people are moving in to Dublin on a regular basis

Villa05 wrote: »

If building a small number is easy and cost effective, the complexities of ramping up to say 10k a year should be offset by economies of scale
Better terms from contractors for increased work
Reuse of house designs etc
Discounts on volume of raw material ordered

I think its important that buyers are fully aware that political actions and inactions are probably the greatest contributer to our dysfunctional property market.
Renters, buyers and their families can vote and therefore influence policy into the future
The purpose of a housing market is to house people not to be manipulated to benefit a very small number of vested interests

Again, if only it were that simple. It’s not despite what the bombers and other socialists tell the public.

Public services pi*s away enough of my money as it is. I would like them to demonstrate they can deliver at scale on a phased basis before I believe they have the competence.

Geuze wrote: »

I don't think anybody is suggesting that local councils become building contractors?

I think what is suggested is that local councils lead developments, and hire building contractors.

What would lead developments mean. One of the biggest decisions over the last twenty years was to more or less abolish sole social housing projects as these were leading to gettoization. That is why the PPP housing project was disappointing in Dublin. Unless you have mixed housing projects you have the risk of future Ballymun's, Knocknaheen'ies and Moyross'es being developed in the future.

It also means that these is often more support and a better chance of social inclusion if housing projects are integrated. Mixed projects of social , affordable and commercial private housing is the ideal way forward.

Hubertj wrote:

Public services pi*s away enough of my money as it is. I would like them to demonstrate they can deliver at scale on a phased basis before I believe they have the competence.

They have demonstrated competence, average build cost in DLR @ 205k per unit. That is the most expensive area of the country. What would it cost to buy in the private market. How much of your money was saved by pursuing a self build

You are basically saying I'm happy for public service to pursue a policy of wasting my money, despite they showing they can deliver at half the cost using a different approach

Hubertj wrote:

Again, if only it were that simple. It’s not despite what the bombers and other socialists tell the public.

The Taoiseach's response to the Oscar tray or road development is telling

"Micheál Martin said the country needed to put ideological arguments about housing to one side and at some point just “start building houses in some shape or formâ€.

That was the attitude that got us the Children's hospital debacle as the government at the time thought it would be a great legacy project for them. As a consequence decisions were rushed and concerns ignored

Quiet an apt legacy indeed mirroring the dysfunctional property market

The people in charge and their attitude make a big difference to the results

Clearly we have people capable of delivering and not delivering

Villa05 wrote: »

They have demonstrated competence, average build cost in DLR @ 205k per unit. That is the most expensive area of the country. What would it cost to buy in the private market. How much of your money was saved by pursuing a self build

You are comparing the cost of delivering a house to the cost of constructing a house. There is a lot more to delivering a house than the bare construction cost.

I expect the private sector could do the bare construction for the same cost, maybe a little less or a little more depending on things like control, scale and financing.

In particular you are having no regard for value of the land, and levies.

There is a lot more to building a new community than throwing up a few units (as was done in Tallaght and Ballymun).

Geuze wrote: »

By lead the development, I do not mean 100% social housing.

LA own the land - do not sell the land
LA get loans from the HFA, as they already do, this already happens, nothing new here.
Or else LA gets loans from the EIB, again this already happens, although not as much as HFA lending

LA uses its own architect, or hires one, to develop a masterplan
LA brings services/utilities onto the site - LA Roads and Housing divisions should already have some experience here

LA hires QS and project managers, or maybe uses its own engineers

LA tenders for building contractor

A mix of units:
(1) sell some at market price, this helps repay some debt / cashflow
(2) sell some as "affordable housing"
(3) cost-rental
(4) social housing
(5) commercial units

Inside the canals in Dublin only workers eligible
Strict rules against anti-social behaviour.


Advantages:
eliminate developer profit margin (15%)
massively reduce finance cost (this is 20,000 per unit according to SCSI)

Singapore gets housing right. While they do allow private builds, it's almost all public housing where you can find a millionaire living in the same building as someone unemployed.

"Public housing in Singapore is managed by the Housing and Development Board (HDB) under a 99-year lease. The majority of the residential housing developments in Singapore are publicly governed and developed, and home to approximately 78.7% of the resident population. These flats are located in housing estates, which are self-contained satellite towns with well-maintained schools, supermarkets, malls, community hospitals, clinics, hawker centres (food court) and sports and recreational facilities. Every housing estate includes MRT stations and bus stops that link residents to other parts of the city-state. Some estates are also complemented by smaller LRT stations which act as a feeder service to the MRT.

There is a large variety of flat types and layouts which cater to various housing budgets. HDB flats were built primarily to provide affordable housing and their purchase can be financially aided by the Central Provident Fund. Due to changing demands, HDB introduced the Design, Build and Sell Scheme to produce up-market public housing developments.

New public housing flats are strictly only eligible for purchase towards Singaporean citizens. The housing schemes and grants available to finance the purchase of a flat are also only extended to households owned by Singaporeans, while permanent residents do not get any housing grants or subsidies from the Singaporean government and could only purchase resale flats from the secondary market at a market price. Such policies have helped Singapore reach a home-ownership rate of 91%, one of the highest in the world. In 2008, Singapore was lauded by the United Nations Habitat's State of the World's Cities report as the only slum-free city in the world. "

With NAMA largely finished with its original purpose, it would seem ideally placed to engage in large scale housing projects that could provide a mix of social/affordable and private housing and outsource the actual building to developers. Although "developers" is a bad word in Irish eyes, they have the expertise but the NAMA driven model could be changed from profit-driven to cost-driven.

The state could actually make a profit from building housing if it managed the process correctly. It's ok and desirable to still have private only development, but that should be at a premium that is heavily taxed by the government. This would get rid of the land hoarding problem as it wouldn't enable land prices to be pushed up speculatively as the market for that will be so small for those who can afford it - effectively a few private estates for millionaires.

For the rest of us, it would mean housing that is affordable and plentiful.

Geuze wrote: »

By lead the development, I do not mean 100% social housing.

LA own the land - do not sell the land
LA get loans from the HFA, as they already do, this already happens, nothing new here.
Or else LA gets loans from the EIB, again this already happens, although not as much as HFA lending

LA uses its own architect, or hires one, to develop a masterplan
LA brings services/utilities onto the site - LA Roads and Housing divisions should already have some experience here

LA hires QS and project managers, or maybe uses its own engineers

LA tenders for building contractor

A mix of units:
(1) sell some at market price, this helps repay some debt / cashflow
(2) sell some as "affordable housing"
(3) cost-rental
(4) social housing
(5) commercial units

Inside the canals in Dublin only workers eligible
Strict rules against anti-social behaviour.


Advantages:
eliminate developer profit margin (15%)
massively reduce finance cost (this is 20,000 per unit according to SCSI)

It does not work like that, the children's hospital and the NPHDB being an example.

Sweet.Science wrote: »

Just on this - are you saying some people pay 400k and others pay 200k for the same house in the same area ?

That is the way it works
If your earnings are below a certain level you get to buy it cheaper
However there are normally clauses that state you cannot sell for a number of years and if you do the state takes a portion of the profit