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

[rungun]

Except that's just not the case, because developers have turned their back on apartments because nobody (outside of AHBs) will buy them. "Increase profits" on something they won't build...eh what?!

Where did this idea that developers are all crafty come from exactly? They simply react to regulations and look to see if there will be a viable product at the end. They aren't morons so will take the highest profit they can but they simply can't make a profit here so won't build.

The "making them more attractive" has not worked. It's a complete failure in fact. In the post crash world the tinkerers got their hands on the regulations and went ott.

Simple reality is that the country has more than enough 3 bedroom houses (and overall bedroom capacity) to accommodate our needs and we need studios and one beds to beat the band.

Now what concerns me is that this won't be enough, because borrowing rules are so tight on single people looking to buy one beds. I do wonder if the Help to Buy scheme (and also the 10% equity rule for first time buyers) can be repeat used if it was first used for a studio or a one bed. If there were 20,000 a year of new studio and one beds in Dublin for sale on €350k-€400k I think we would be going a long way to solving the issues we have.

We can deal with this fantastical "European 3 bedroom apartments with loads of storage space" in a few years once we make a dent in the core problem.

 

[joe sod]

The "making them more attractive" has not worked. It's a complete failure in fact. In the post crash world the tinkerers got their hands on the regulations and went ott.

That's exactly what happened, in the wake of the crash the zealots took over. We entered the era of big government, big state but big state does not work in Ireland because we are not Scandinavians.

 

[Purple]

That's exactly what happened, in the wake of the crash the zealots took over. We entered the era of big government, big state but big state does not work in Ireland

That great Ronald Reagan quote; "The eight most feared works in the English Language are "I'm from the Government, I'm here to help"."

 

[Duddaa]

It’s not just the cost of an apartment. Keep in mind timeframes to any proposed changes in regulations on apartment design or standards.

I doubt any 100 unit apartment development has gotten planning permission in less than two years from appointing a design team. Say 4 months to do surveys, design, drawings. Planning 2 months, further information request 2 months (optimistic depending on what’s requested), 1 month to review submitted further information. 1 month for grant. Then appeal to the board. 18 months minimum for that. That’s 28 months.
Presuming it doesn’t go to judicial review (which often happens in large Dublin developments) then you’ve construction which will be another two years at best before an apartment is occupied. That’s 52 months. Whatever changes they introduce in apartment design won’t be felt for a long time.

Now here’s a bigger problem. These are draft regulations to change apartment designs. Government holidays start soon so it will be September or October before these regulations are introduced and signed into law. Add the 28 months for planning. That’s over 3 years into the current government. Contractors don’t like uncertainty so are likely to wait the 8-10 months until the next government term to see who gets into power and what rent freezes, caps, subsidies, etc are introduced which could greatly impact the financial viability of the project. Their other option is to sell them all off plans in one transaction to provide cost certainty but that doesn’t allow purchase by first time buyers on completion.

 

[rungun]

The extension of planning permissions though should hopefully mean the LDA can still mobilise sites where there are existing planning permissions. If this can be a "bridge" to these regulations coming into practical operation then that's a decent mitigation.

We will of course pay for it, as the specs on these PPs are at the high bar.

 

[BIG-notorious]

These are all retrograde ideas.

According to the Irish Times:

"The minimum floor area for a studio (one person) is 37sq m; 45sq m for a one-bed (two people) unit, 63sq m for a two-bed (three people) unit, 73sq m for a two-bed (four people) and 90sq m for a three-bed (five people) apartment."

and

"In terms of floor area, the minimum size of a studio apartment will be reduced to 32sq m while a new standard for a three-bedroom, four-person apartment of 76sq m will be introduced. The other units will not change."

I've lived in 3 beds smaller than 76 square metres. They're compact, but they're hardly shoeboxes. To my mind 45 square metres for a 1 bed and 60 square metres for a 2 bed are about right as minimum standards. I think new build studios should be banned though.

Much more important are the other standards for new builds including energy efficiency, fire safety, ventilation, and accessibilty. Compromising on these would definititely be shortsighted and retrograde.

they won't end up making apartments more affordable just increase profits for developers.

I'm not sure why you think making apartments or other homes affordable should be the primary goal. The goal is increased supply not reduced prices.

Developers will not work for free. Nor will the host of professionals, craftspeople, labourers, delivery drivers, etc etc who need to work together to build anything. We have full employment and there's any number of jobs available, so if we want people to work or run a business in the residential construction industry they will need to be well paid.

The only way of getting even partly around the increased delivery of residential construction being conditional on increased profits for nearly everyone in the residential construction industryis to import pre-built homes from outside the country. And even that would only displace the increased profits to the residential construction industry of another country. For the life of me I can't understand why we're not already importing modular homes from China by the shipload- if they can make our cars I can't see why they wouldn't be able to manufacture our homes to what are after all much less exacting tolerances...

Planning rules should make apartments more attractive alternatives to houses... larger floor areas, more multi-purpose rooms and storage space. Of course there should be windows and green areas in these developments. And you shouldn't have to pay > 500k for these "luxuries".

In principle yes, in practice what makes them more attractive to consumers also makes them less attractive to producers. Homes aren't fungible in the current market. They may become more fungible in the future (eg by exempting residential cabins from planning permission and/or or moving wholesale from a restrictive to a permissive planning system). But right now, that's not where we're at.

• edit- as someone who lives outside of Dublin the idea of paying over €500k for an apartment of any size is very weird to me....

For the record, I own my own home and have no intention of leaving any time soon, and I neither work nor even know anyone who works in the construction industry so I've zero skin in this game personally.

 

[rungun]

Why "ban" studios? There absolutely is a role for them and there is a market demand. If they are good enough for others in the OECD, why not here?