Dublin Housing Crises

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Sophrosyne

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Orla Hegarty, UCD School of Architecture, Planning and Environmental Policy made what I thought were some excellent points at a public meeting on the Dublin Hosing Crisis, held on 24 July last.

One of the points she made was:-

“A mayor in a fast growing town in the Netherlands which owned a lot of land decided to master plan the town. This is what should be done in areas like Shanganagh Castle and Clonburris and parts of the city where new towns/cities will develop.

The master planning is done centrally by the local authority. It is decided where the streets and roads and services will go. The local authorities put in the street lights, draining and the roads and any one can come along and buy a site.

There is a plot shop in the town. Anyone can come along as a small developer or as an individual who wants to custom build and the price of your plot is a set value per square meter.

There is no land speculation because every site is worth the same amount of money. You can engage a builder to build your house or you can self-build. Developers can build apartment blocks but the price of land the stays same.

This model has been enormously successful. This type of development also brings competition in to the market because what we have now is a lot of large developers who are setting the price and we don’t have anyone snapping at their tails that provides an alternative for people so effectively we’ve no competition really in the new building market.

We need other models that loosen it up and start to give people opportunities of different ways of doing it and making the money that they can borrow stretch.

By master planning you also de-risk the whole planning process which means you take a lot of the cost out of it because people are not waiting a year for planning or are unsure about whether they will get planning.”
 
There are lots of housing estates in Ireland built that way Co Council put in the services and you could buy site for a set price,
They were set up in towns where the IDA built advanced factories from around late 1960 to around 1986,
There was usually small amount of houses built for key workers rest was sold as serviced sites,
If you google housing finance Agencies i expect you will find information,

Another interesting read is Dublin Employment and Housing Motion 16 Nov 1976
 
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So basically what she's suggesting is the Local Authority sell off micro-sites with full planning permission?
And the sites are sold after the utilities have been installed. So the LA picks up the entire tab for the utilities?
And the "key" to this is the LA sells the sites cheaply?

Some problems with this:
1. You're stuck with the design the LA approved. Otherwise you're back into a full planning application.
2. Unless the LA has individually designed each individual house down to the wiring & bolts, you'll most likely need to employ an architect & engineer anyway.
3. What's the difference between this and an "affordable" housing scheme. It's basically subsidy to individual house buyers i.e. below market value fully serviced land.
4. How many people have the time, knowledge and gumption to manage a small builder?
5. How many people can (1) get the deposit to buy the land in the first place, and (ii) can get a self-build mortgage which are more onerous?
6. How many people would want to live in a never ending construction site as build-out of the entire development would take years.

If the idea is to sell the land cheaply to small builders then it doesn't solve any problem other than giving that small builder cheap land on which he'll just charge the going rate for a house in the area i.e. you increase the small builder's profit.

If you had LA building inspectors and some sort of accredited builder scheme which provided confidence to buyers then perhaps it would be an interesting concept, but you don't.
It makes more send for the councils to just build directly and sell a % on the open market.
 
It has nothing whatsoever to do with selling land off cheaply, but rather stabilizing land values.

What she said is that there would be no land speculation as post installation of services, land would be given a set value per sq. metre, irrespective of what is built on it and regardless of who buys it - be they individual buyers or builders in a large or small way of business.
 
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I have a sibling in Belgium who has bought two houses under variations of this approach in the last twenty years. For the first one he bought a serviced site and employed an architect who looked after engaging a builder. It was a completely custom build and architecturally unique, but within planning constraints (not a detailed prescription) imposed by the local gemeente. Houses in the area are generally unique and one off, but never eyesores, unlike the stuff we build here which seem to be either McMansions or identikit shoeboxes. His second house was done quite differently, this time on serviced land acquired by a building company to build about a dozen houses. They offered a number of high level plans to potential purchasers, with a large amount of tailoring and customisation possible. The build was done on time, within budget and finished to a high standard. The total budget including complete kit-out to bring it to moving in condition was €700k. The location is about 15 minutes from a sizeable regional city (about half the population of the Dublin City council area), and the house is 4,500 square ft. (This was around 2007, roughly coincident with the peak of our own last bubble).
 
Sophrosyne said:
It has nothing whatsoever to do with selling land off cheaply, but rather stabilizing land values.

What she said is that there would be no land speculation as post installation of services, land would be given a set value per sq. metre, irrespective of what is built on it and regardless of who buys it - be they individual buyers or builders in a large or small way of business.
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And how exactly does it stabilize land values if the land isn't being sold on the cheap? You even state that the land is fixed at a price regardless of end use and apparently time. Developers pay more for large parcels of land as they can build large homogeneous volumes cheaper than Johnny self-build van build an individual unit. Therefore the land is worth more to a large developer than to a single site purchaser. Which means the land is being sold below market value as the developers higher value is the market value.
 
Im not sure how the idea above would work out, but at least its encouraging to see suggestions that dont amount to tax-breaks for developers and landlords.
The whole housing sector needs reform. Starting with developing policies that recognize housing as a social and critical necessity for the population in fostering a civil society.
From there we can decide what type of economy we want and who it is for.
Once those concepts are recognized and adopted we can plan housing to greater effect and efficiency.

The consequences of the current market driven commodity housing market are;

the abdication of the State from its responsibility to house the population;
the building of too many houses in wrong locations, driven by flipping properties for profit;
not enough housing where its needed resulting in increasing homelessness and increasing waiting lists;
increasing property and rental prices to effective extortionate levels or beyond the reach of working people;
delaying family planning;
increasing disenchanted amongst younger population with regard to prospects of suitable housing;
potential negative effect for inward investment;
potential negative effect for employers sourcing employees (somewhat moot considering most major cities across Europe US are experiencing similar housing crises).

The last point (in brackets) should raise the alarm bells. This is not an Irish problem. It is a social and economic problem derived from policies that treat housing as a commodity to be bought and sold for profit, the consequences of which are manifesting across the globe in similar market driven economies.
 
Hi Sop

I had not heard of Orla Hegarty until the weekend before last when she spoke at the Dublin Economics Workshop.

She was excellent and I wondered why she is not featured more on programmes about the housing crisis.

Here are some of her slides with a couple of my comments below. I hope I am not misquoting her.

upload_2018-9-25_9-5-6.png

I had heard this before - the optimum cost for building homes is 6 stories.

upload_2018-9-25_9-5-23.png

upload_2018-9-25_9-6-47.png
The left hand column is how we talk about housing, the right hand is how we should talk about it.


We simply don't have the capacity to build the number of houses required. What happens then is what happened in the past, people who don't know what they are doing, start building houses and we get very poorly built houses.





Brendan
 
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Brendan Burgess said:
We simply don't have the capacity to build the number of houses required. What happens then is what happened in the past, people who don't know what they are doing, start building houses and we get very poorly built houses.
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I agree totally.

The point Orla Hegarty made above was just one of her points.

It is really about affordability.

Recent governmental studies have shown that Irish construction costs are broadly similar to the UK, France and Germany and slightly higher than the Netherlands.

She is calling for a different land delivery model. There is little point in large expanses of speculatively built properties that the majority cannot afford.

A developer who pays a high price for land will expect correspondingly high sales income. If the market cannot bear this he may defer construction until it does.

Rising land prices encourage investors who have no intention of building anything; the aim is to sell it on when the price is right.

Among other things, she also advocates freeing up the vast amount of vacant properties around our cities, where the infrastructure already exists and looking at barriers to their redevelopment or conversion from commercial to residential use.
 
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I would suggest looking at Singapore for options to deal with housing.

https://en.m.wikipedia.org/wiki/Public_housing_in_Singapore

I dont advocate the massive tower blocks built in Singapore but certainly the concept of building for the economic needs and the population to sustain that economy are considered in their policies.

Some suggestions could be

-99 yr leaseholds
-Public housing managed by private letting agents or property managers competing on criteria of lowest rents
-Use or lose developer tax, prompting developers to sell units at reasonable prices rather than hoarding for greater profits at undefined future time.

These are some suggestions none of which act as a panacea to resolve the issue. They do however offer options, and the more options the greater prospect of finding improvements in my opinion.
 
Brendan, I hadn't heard of her until last week, she was on 6-One news and spoke a lot of sense. It was the same day as the announcement of the land bank authority or whatever it's called. She skewered it.
Thanks for sharing those slides.
 
I take issue with the student example for the very simple reason that students too need housing and putting them into small units houses them adequetly without taking up as much land size as would be needed for regular apartments. We were given some free cake buns in Dublin by some young people who were marketing a new student accomodation being built. Most normal landlords don't want students, plus they only rent for 7 months, another problem, plus they are notorious. So it's a good thing that dedicated accommodation suitable to their needs is being built. Plus how often do we hear the likes of places in Cork on about how the students are partying like crazy. In this purpose blocks with security it's a much better and safer environment for all of society.
 
T McGibney said:
I wouldn't count that as a good tweet. Argument along the lines that bakers shouldn't be baking cakes if there's a shortage of bread.
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more like Ireland has a good supply of bakers providing lots of bread that people can afford to buy no matter what there income is, there is also room on the shelf for cakes and sweet cakes,
as it should be,
The trick with housing is to plan so we get the same supply in housing as we do when it comes to baking,
 
RETIRED2017 said:
The trick with housing is to plan so we get the same supply in housing as we do when it comes to baking,
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No, central planning is spectacularly incapable of efficiently providing social goods, including housing. It's the "how can we plan the bread supply for New York" fallacy.
 
Bronte said:
I take issue with the student example for the very simple reason that students too need housing and putting them into small units houses them adequetly without taking up as much land size as would be needed for regular apartments. We were given some free cake buns in Dublin by some young people who were marketing a new student accomodation being built. Most normal landlords don't want students, plus they only rent for 7 months, another problem, plus they are notorious. So it's a good thing that dedicated accommodation suitable to their needs is being built. Plus how often do we hear the likes of places in Cork on about how the students are partying like crazy. In this purpose blocks with security it's a much better and safer environment for all of society.
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Well said. Seems Ms Hegarty would prefer to have hordes of students bidding against workers and families for already scarce accommodation.
 
T McGibney said:
No, central planning is spectacularly incapable of efficiently providing social goods, including housing. It's the "how can we plan the bread supply for New York" fallacy.
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I like the sound of that word fallacy , I made a good living for the past 30 years because most people in the industry I worked in miss understood it meaning ,

You trip across them every day of the week,
 
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