What can be done to bring down the cost of building homes?

Strangely, even if the landlords head for the exit, their houses don't disappear.
The availability of beds to rent reduces. Simple example family with two kids in a rented three bed house. Landlord sells and a couple with no children purchase (with intention of having a family in the future).

You still have one house but nowhere for the two kids previously living in the property to sleep!
 
And if a family with three kids buys it then the availability of beds increases. Either way things will average out so there'll be no net change.
 
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Granted, we're talking about getting away from the old image of a half dozen lads leaning on their shovels, drinking tea, and looking into a hole in the gro
I know this was meant as a bit of a joke , but that image was really about council workers and that's the real reason why the state does not want to employ construction workers themselves, you end up with glorified county council staff.
If it was the case that construction was such a handy job where you could stand around a hole drinking tea well then why is it so hard to recruit construction workers, even with relatively high wages and over 400,000 people on the PUP ?
The fact is that a lot of construction is dirty,dangerous, hard work, you never know what obstacles and problems you are going to encounter when you start digging . Many facilities and utilities are not properly mapped and not in the places they are supposed to be, unlike in the Nordic countries. While it may be easy to draw a line on a plan by an architect, realising that line in reality can be very difficult when you encounter the above issues.
 
That is a problem but it really only effects the ground works. The rest of the house should be built in a factory and assembled onsite. Bathrooms can be built completely and pressure tested before arriving onsite. A few Irish companies have even tried this but have been unable to get the regulations modernised so that their products could be certified.

There is a US company, owned by an Irish American family with Limerick roots, now manufacturing factory built homes in Limerick so maybe the Dept of the Environment has got their house in order, 10 years later.
 
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There is probably a cultural thing in Ireland going back to the Rhofab prefab houses of the 70's (albeit I've been in a few and they weren't the worst.) that would need to be got past first.
 
There is probably a cultural thing in Ireland going back to the Rhofab prefab houses of the 70's (albeit I've been in a few and they weren't the worst.) that would need to be got past first.
If Irish people are actually that stupid then we deserve to have a housing crisis.

It's bad enough that so many idiots support measures to stimulate demand when the problems are on the supply side but if people are so gob-smackingly moronic that they are incapable of rational thought then to hell with them.
 
If you want to, you could buy a new 3 bed/1 bath semi in Carlow town for €199k and you would be 45 minutes from newlands cross so it's ideal for anyone working in Citywest or Tallaght

A 3 bed 2 bath terraced house in City west would set you back €365k.

So if I am working in City west and don't want the commuting cost/time then the price for living near where I work is €166k

Now I know the 2 houses may have different build/quality etc but if you assume material and labour costs are more or less the same, then what makes up the difference- is it the land price?
 
According to the Institute of Chartered Surveyors the cost of Finance accounts for 6% of the total cost of the average home. Given that factory built homes are faster to produce and can be manufactured while the groundworks are being done there should be a significant reduction in the cost of finance.
If the cost of finance is really up to 10%, as indicated in the link above, why are there not specialised finance companies competing within the sector? a 10% margin is beyond anything that can be made in Bonds or normal banking.
Given that the Institute of Chartered Surveyors are part of the construction sector they are hardly a neutral player in all this so should their numbers be taken with a pinch of salt?
 

I assume that the lending institutions have a 'cost of capital' aspect which impacts the rate they can lend at. This is all based on the current building process and perceived riskiness of the developers.

I agree with you that if you changed the build process to pre-fab manufacturing which led to a quicker build process it reduces the risk and should reduce the cost of financing.
 
I agree with you that if you changed the build process to pre-fab manufacturing which led to a quicker build process it reduces the risk and should reduce the cost of financing.
It also means that if the developer goes bust while the houses are being manufactured they could be sold to a different developed and assembled onto different groundworks. In other words they will have a saleable value on an open market and so the risk to the lender is reduced.
 
Off-site manufacturing is definitely the way forward, but most lenders are if anything less keen to lend against moveable assets than against work on site. If you are bankrolling a development and if a huge chunk of the development value is held off-site in factories, the financing becomes more complex and therefore more costly. More often than not, the real effect is to shift risk to manufacturers and their bankers. But none of this is insurmountable- just not necessarily cheaper.
 

No, it's the market.

Agree it's the market.

But isn't the market effectively valuing that piece of land and it's location at 166k more. (let's assume the buildings are identical).
 
And if a family with three kids buys it then the availability of beds increases. Either way things will average out so there'll be no net change.
No it does not as the number of bed spaces/bedrooms still stays the same. Normally people trade up for extra bedrooms or as a min trade to a property with the same no of bedrooms. Rarely do people trade down. Trading down is not unheard of but is unusual.
 
Agree it's the market.

But isn't the market effectively valuing that piece of land and it's location at 166k more. (let's assume the buildings are identical).
The market is valuing the property because of the amenities surrounding your property in City West compared to your property in Carlow. it is to simple to compare two similar properties (in terms of size and build costs, finish etc) without factoring in the differences outside of the property itself.

Build costs are not the only factor in the cost of a property, land costs will vary specifically for the reason above.
 
So if I am working in City west and don't want the commuting cost/time then the price for living near where I work is €166k

but the differential between the cost of a house in the City and Carlow is a lot more than commuting costs, people are prepared to pay a substantial premium to live in the city. I know the whole Covid and working from home theme has sought to play this down, it was easy to to this when all the social life of the city was closed down. Within that 166k is also the value of the Dublin social scene.
 
My local school recently completed a small one classroom extension cost approx 180K. The professional fees from the Architect were 38K including vat for design and supervision and then people wonder how building is so expensive. Imagine how much professional fees would be on a housing estate when one room cost 38K.
 
  1. Remove VAT cost on new builds - now and forever and commit to never taxing the building of sovereign/societal infrastructure again! You lunatic politicians!
  2. Increase existing property tax levels to replace tax receipts from (1)
  3. Up vacant site tax considerably
  4. Aggressively provide provisional residential zoning permissions to scare land horders as per (3) + increase development land 25km around Cork/Dublin/Galway/Limerick/Waterford
  5. Government led road shows for skilled migration from Eastern Europe / RoW (plumbers, carpetenters etc.) - 3 year visas etc…..everyone likes to beat up the banks as greedy in the property market profit cycle……given the opportunity your friendly site plumber and his Union will gladly charge 2k a day….and pass the hat to the first time buyer……labor supply is key to maintain cost control
  6. Tax breaks for returning Irish immigrants with construction skills
  7. Increase apprenticeship programs to replace (no. 5 RoW) workers over time
  8. Differentiate lending from banks to new build homes vs. existing homes…CBI lending multiples is one avenue…..…...One is GDP & capital stock accretive (new builds), the other is a financial transaction on an existing asset (with Caveats)…..but you get the point….they are not the same thing and shouldnt be treated as so…..shared equity & HTB is trying to achieve this
  9. Government should acquire the largest Irish PLC house builder - Glenveagh Properties - and make it a semi-state company with the same management,cost and incentive structures benchmarked against the other PLC home builder Cairn Home but Glenveagh will have a zero P&L target…….Glenveagh is building a company that is designed to be the low cost producer of starter homes in the state with per annum target builds of c.3,000 homes a year in 2023. Go pick it up now while its cheap - selling below book value.
  10. Supply chains have proven to be fragile (shortages / inflation)…….Brexit….COVID……strategic aim of in-sourcing more building materials from the island of Ireland
 
I agree with many of your suggestions but;
Remove VAT cost on new builds - now and forever and commit to never taxing the building of sovereign/societal infrastructure again! You lunatic politicians!
That won't reduce the sell price, just the cost price. It's not a normal open market so reductions in cost won't translate to reductions in price.
+ increase development land 25km around Cork/Dublin/Galway/Limerick/Waterford
Bad idea; we've enough urban sprawl as it is. If we can't to grow outside the citied then have development plans for our towns.
With all the public service type work practices, pensions and inefficiencies? I'd rather see the State just get better at procurement.
Supply chains have proven to be fragile (shortages / inflation)…….Brexit….COVID……strategic aim of in-sourcing more building materials from the island of Ireland
We don't produce the raw materials here. Attempting to on-shore our supply chain would add massively to our costs and serve no purpose as the suppliers have their suppliers and those will be outside Ireland anyway. We're not going to produce glass and PVC and the polymers for insulation and wiring and rubber and steel for nails and screws and hinges and latches for doors and windows and polymers for paint and varnish and all the other niche products that go into houses.
 
The school no doubt had to go through a public procurement process where only the larger more expensive outfits quoted (procurement process is cumbersome and takes time, even when you don't win, so that's all added to the costs)

Sounds like they got very bad value for the architect, but then, such project like having someone to carry the can, so pay a premium.

Then, you just can't compare the supervision costs for a singe bad value room against a full estate development. They'll get much better value and economies of scale to bring the cost per unit well down.