The Irish Times view on housing: beyond reach

Land and building costs have pushed the price of apartments out of reach of those on an average wage

An artist’s impression of the proposed Project Waterfront scheme as seen from the South Quays in Dublin

An artist’s impression of the proposed Project Waterfront scheme as seen from the South Quays in Dublin

 

The purchase by foreign investment companies of entire apartment blocks attracts mixed reviews. On one hand, these agencies are blamed for locking would-be owner-occupiers out of the housing market. Others contend that, in the absence of their financial involvement, the apartments would never be built. The only thing on which everyone agrees is that there is a serious shortage of apartments in each of those cities nominated for rapid development – Dublin, Cork, Limerick and Galway.

It has been estimated that the sale and rental market in Dublin alone requires 9,000 units a year. But construction this year will deliver fewer than 3,000 apartments. At a time when a great deal of building activity is concentrated on providing office accommodation and the IDA is encouraging greater inward investment, where are these additional workers going to live? And will they be able to afford the rent?

Rental costs have emerged as a serious obstacle to the expansion and relocation plans of a number of major companies in Dublin during recent years. It has got to the stage where, as in San Francisco, tech companies are considering commissioning bespoke accommodation for their workers, rather than risk negative publicity by competing locally for limited home space.

Land and building costs have pushed the price of apartments beyond the reach of those on an average wage. In response, Minister for Housing Eoghan Murphy raised the height limit on apartments and introduced a fast-track planning approach two years ago. It hasn’t worked.

A review found that construction had begun on fewer than half of the projects sanctioned under the scheme. Concerns were raised that developers were using its provisions to artificially increase the value of their properties. There has also been intensive lobbying of Government ministers and officials amid dissatisfaction with the outcome of the planning process. It’s hardly surprising that vested interests would pursue their own agendas. The Minister has a wider obligation: to act in the best interests of all.

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