Building costs – paying over the odds?

 

Sir, – Your editorial “The Irish Times view on building costs: is the State paying over the odds?” (January 27th) states that, “one of the primary reasons why housing is so expensive in this country is because of land”.

The Society of Chartered Surveyors Ireland report, however, states that land cost makes up just 11 per cent of construction costs, with “hard costs” amounting to 47 per cent of the costs, and soft costs 42 per cent of the costs.

The editorial suggests that there can only be two alternative explanations for a disparity on hard costs between the private sector and what the public sector is being charged.

Either the council is being “taken for a ride” or “procurement processes” are driving up costs and contributing to the affordability crisis.

If either scenario is correct, the policy prescription of “building en masse on State-owned” land will not be the panacea that is hoped for. The building would be done by a private contractor through public procurement.

It is clear that we need a commission on housing costs to help drive down the cost of construction.

But we also need local councils, approved housing bodies, private developers and the Land and Development Agency each playing a role in the delivery of both social and State-subsidised affordable purchase and rental homes on public and private land. – Yours, etc,

Cllr JAMES GEOGHEGAN,

Fine Gael,

City Hall,

Dublin 2.