You’ve made good points taking apart some of his arguments before. I don’t know if there is anything in the whole plan to address the capacity of the sector, do you?
From a policy perspective I just don’t think the approach of giving individuals grants so that they can access the overpriced market is a good solution. It’s the same approach as HAP, but for buying houses instead of renting them.
It’ll sort some people and “get them on the property ladder” and maybe shore up FFs vote that way, but it won’t fix the market.
All about keep the prices rising to sort out the 45+ vote. By increasing supply it will send them into negative equity and essentially shaft them for the lies of the last 15 years. Its an Irish solution to an Irish problem. Shit on the generations after you
Yeah I dont know about the capacity issues in the plan. I havent read in any great detail at all, other than snippets and seeing comments from my own industry figure heads on it. I’ve said it here before, but an awful lot of the cost of developing houses is in planning costs, VAT, land acquisition levies etc are a significant portion of the end cost paid by the consumer, yet these are all direct issues that the government can alter to lower the output cost.
There probably are two different things at play here, one is a supply issue and one is a cost issue. Will putting more supply out help the cost issue? It will, to an extent. To say otherwise would be wrong. It will help reduce existing prices and lower the market generally. But its not a sustainable solution. Costs are still going to be costs on new builds.
However if there are grants or money available to developers which helps cover their margins etc, as long as that is accounted for, then their end cost to the consumer should be reflected in the price sold. Should being the main word there. But all these things should be analysed and only approved through proper independent analysis of any government money issued to a developer or refunded if thats how it will work either.
I hate sqaure foot quotes. Too long to go into why. But there is no reason you cant get a fully finished house, with site works, for that sort of money, if designed efficiently. The extent of the siteworks depends though, which is why ft2 rates are bollix. Plus, for your mansion of 8,000ft2, thats a range of €240k.
You say “build own and operate” which is funny because the angle he takes in the article is all about buyers (as opposed to renters).
I would have thought that if the state is building houses on a massive scale, and using state land to do so, that it should absolutely be targeting people to rent those homes, not to buy them. They should also not repeat the mistakes of the past and in time sell those homes on reducing their stock. If they do that on a big scale then affordable housing will be reached - and that will diminish the clamour for affordable ownership (which I’m not sure is something the state should be prioritising anyway)
His point about the political impact of looking to reduce the price of houses is real and I don’t believe SF are really going to shout from the rooftops about that either to be honest. I certainly haven’t heard Eoin O’B making a regular virtue of the fact that he’s going to reduce the value of peoples houses and I’d be surprised if they’re as fearless in making that a big aim as you’re suggesting.
I agree with you that the help to buy scheme is utter bullshit.
As @Gman alluded to supply and cost are the two major issues. The government have more scope to influence the latter via the high percentage of build cost made up of taxes and levies but people seem obsessed with the State influencing the former, despite the resource constraints.
A predominantly free market approach contributed to the supply shortage and now people want to pivot the opposite direction to a situation where the State is the only show in town. We need to utilise the State where we can generate economies of scale and to provide for those who can’t afford market prices for rent and purchase and let private capital build your Capital Dock type establishments.
We are told this is an emergency but ideologues on both sides of the political divide are happy to defer projects that don’t meet the needs of their target demographic (FFG protecting house prices and bank balance sheets, the “left” objecting to anything that sees a pig in a top hat earning a buck). Centralising all housing activity into State Agencies will exacerbate the political influence over the market so shouldn’t be the only game in town. There’s a need and demand for social housing, and high end apartments.
The state owning a renting a big stock of houses helps buyers too. The state owning a housing stock is an asset into the future.
On prices going down, it’s probably some time before that happens, if ever. You’d nearly settle for levelling off. Anyway, say the value of your house goes down, so does the value of the house you hope to trade up to in the future, it’s not necessarily a huge loss.
But politically SF are the only ones that can take on the notion that house prices should always go up. The value of your investment may go up as well as down. People seem to accept that everywhere except for houses.
in fairness to Burke Kennedy, he’s been going at that stick a long time, so whilst he might not say it there, its a massively constant argument from him and always comparing state developments to private developments, with his buddy Orla Hegarty feeding him masses of misinformation.
SF in opposition will say that as they are anti-establishment. Once they are in power and fully assimilate into Jack Lynch’s Fianna Fail and have civil servants and the Central Bank in their ear it’ll be business as usual. Paddy only has one investment asset and it’s his house.
But this is the point. You have builders out there, which is better for them, doing private development work or going to government tender work? If they have a choice, they will chose the former. Bar that, the government have little control in telling contractors what work they can do.