Why does it cost so much to build apartments in Dublin?

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Protocol

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New 2-bedroom apartments are for sale in Liverpool from £170,000 - £280,000, or from about €200,000 to €330,000.




Yet we are told that it costs in excess of €500,000 to build an apartment in Dublin.

Steel, cement and timber are internationally traded commodities, so there should not be dramatic differences in these costs.

Minimum floor areas and labour costs are somewhat higher in Ireland than in the UK, but this isn’t enough to explain 50% higher costs.


What explains the higher costs? And what can we do to drive them down, so as to make the construction and sale of apartments viable?

Site costs?
Costs of finance?
15% desired developer profit margins? [note that this is separate to the builder's margin]
 
VAT is 3% higher here which would add €10k-€15k on the material costs but also additional costs on any professional services. Possibly the building regs are more stringent. Land cost is a major part as are labour costs
 
The dual aspect adds a lot according to a few architects I know. Makes a significant design difference. I live in an apartment with a central hallway and rooms on both sides have external windows. Only 2 bathrooms have zero external aspect.

Downstairs there are some smaller apartments with single aspect.

I can see the challenge of designing it. You’d have a lot more smaller apartments here if they were all single aspect. Dunno how much cost that adds. Quite a lot I’d say. Theres often a need for a central courtyard or some sort of a well in the centre to accommodate it.
 
VAT is a good answer, thanks.

It's 13.5% here on new houses.

It's either zero or low on new houses in the UK.

EDIT - I see it's zero VAT in UK.
 
Dr Strangelove said:
It’s 25% in Sweden and still they build more units per head than us.
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I know everyone likes to mention what Sweden does but we are no way comparable to the scandis in anything, the brits are what we need to benchmark ourselves against, if we are doing things alot worse than them then we need to change to how they do stuff, obviously politics and vested interests get in the way
 
A large part is the design requirements. Dual aspect, outdoor space for each unit, insulation levels and renewable technology, minimum area requirements, mix of units required, storage areas, avoiding north facing units, etc. If builders were allowed throw up any old buildings they wanted, they'd be a lot LOT cheaper but darker, colder, less energy efficient, tiny, cramped units.

You could lower building design standards a bit but you have to be careful not to lower them too much. Short term we need housing but longer term you need better quality housing.
 
From living in apartments and other people's concerns about apartments, dual aspect doesn't come up... sound proofing, size, limited heating options \ scope for insulation, storage space, common areas (security and amenity of) are the ones that seem more common.
 
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I didn't know new-build apartments have to be dual aspect? That (and the stringent "green" requirements) would explain a lot of the cost.

I lived in a "single aspect" apartment for three or four years in the 1990s (Monkstown Valley for those who know it.) The living, two bedrooms etc were lined up on the window side with a decent balcony accessible from the living room. I thought it was fantastic - luxury living for me at the time. Never occurred to me that I was missing out on something.
 
I think if you asked young potential purchasers particularly those on low enough incomes, they would happily forego the dual aspect, balcony, ensuite, car space (or some of these at least) for an apartment that they could actually afford to buy as long as it was warm, properly built etc. I hear anecdotally that Liam Carroll's 1990s 'shoe box' apartments are popular and sell well.
 
My first apartment was single aspect, 420 square feet, had no parking space, the sound insulation wasn't great and I know that the fire doors etc weren't up to scratch. Other than the last issue the rest weren't a problem. I loved it. It was in South Dublin City centre. It cost €72k (£57k) and I could buy it as a 23 year old. Perfection is the enemy of the good.
 
Protocol said:
VAT is a good answer, thanks.

It's 13.5% here on new houses.

It's either zero or low on new houses in the UK.

EDIT - I see it's zero VAT in UK.
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I worked out on a spreadsheet the rough amount of income tax, VAT, stamp duty and other assorted levies / taxes we had just financed over 30 years when taking out our mortgage. And threw in a few grand for the planning delays caused by NIMBYs taking advantage of our dysfunctional planning system. My wife's perspective has changed a tad from a more liberal to conservative one once seeing the tax up in lights - particularly so when we didn't have access to the first time buyers grant and the number of units going for public housing.

Not against the latter, but it is hard to swallow just how the State takes so much money off the top.
 
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