As mentioned last week, the property supplements are slowing down for the summer so all reading in this weekend’s broadsheets is a shade lighter than usual. Bear with me as I dig through other sources to pull together the most important (or not important at all but mildly interesting) property news.
You are welcome to email me with any industry news and updates at Carol@CarolTallon.com.
Last week I wrote about the introduction of new regulations for the Irish rental market, Statutory Instrument No. 17 of 2017: HOUSING (STANDARDS FOR RENTED HOUSES) REGULATIONS 2017 (download here: S.I. No. 17 of 2017 in PDF). The key changes relate to improving fire safety and air quality in rented units. The other important aspect of these new regulations is that they reinforce the previous ban on bedsits (below 6.5sq.m) by prohibiting shared kitchen and bathroom facilities and require individual unit metering for utilities.
In The Sunday Times, Hannah Kingston writes ‘Estate agents find space to rent bedsits despite the ban’. In the article, she sets out that 15-20 bedsits were available to rent in Dublin last week via property portals Daft.ie and Rent.ie. Reading through the article, it would seem to me that there is confusion between bedsits and studio apartments (kitchens vs. kitchenettes).
Of course the quality of rental accommodation must be managed; however, we need to question whether or not it is helpful in a market of rising homelessness, chronic shortage of rental accommodation and unaffordable monthly rents (entirely out of whack with our social housing assistance) to eliminate the estimated 3-5,000 bedsits from the lower end of the market? I don’t generally buy into the ‘property ladder’ notion, but there are definitely different levels of what people in different financial circumstances deem acceptable. Can Dublin afford to exclude the entire lower ‘rung’ of the ladder and tell renters that €1,000 is the absolute minimum rental; if they cannot afford to pay that, then they cannot afford to live and work in the capital?
This is nonsense and I hope our new Housing Minister does not see this as a fait accompli. In a market emerging from crisis, perfect is the enemy of done. We need to get it working at a basic level and then improve it. I am certainly not calling for the return of the grotty bedsit, but we do need to introduce a lower ‘rung’ on our increasingly unaffordable housing ladder.
The Sunday Times
Opportunity for owners of vacant/derelict property nationwide
Applications to local authorities under the ‘repair and leasing’ scheme remain low, with only 14 applications to Dublin City Council so far. This figure is lower in other areas, with Galway city attracting zero applications to help them hit their target of 24 new social houses through this particular scheme. Interest appears to be highest in Cork, where the target is to deliver 50 ready-homes and 40 applications have been received to date. This scheme, when introduced by former Minister Simon Coveney, was expected to facilitate the delivery of up to 800 social homes nationwide. I cannot help but see the opportunity for the private owners of derelict or vacant (for 12 months+) properties around Ireland to finance the upgrade of these units – up to €40,000 each – and then let it to an approved housing body for 10 years. A further €108 million has been set aside for this scheme until 2021 so it is definitely worth considering.
- Enda O’Cineen has applied for planning permission to turn the former HQ of his Kilcullen Kapital in Dun Loaghaire into two resident units.
- Page 5 of the business section looks into the sale of Nama’s Project Tolka (€455m), made up mainly of loans to veteran developers Paddy Kelly, John Flynn and Alanis (Paddy Kelly and the McCormack family).
- Facebook is “doubling down” on its €200m data centre in County Meath according to Gavin Daly (unconfirmed by Facebook).
- Oaktree Capital Management (last I wrote about their imminent launch on the Dublin stock market) is set to purchase sites on Shrewsbury Road and at Blackrock for building ‘upmarket’ homes.
- Nama in bid to build 360 apartments close to the new Central Bank building in the Docklands (on the site formerly owned by Liam Carroll).
- Lorcan Sirr in his column this week decries the return of bedsits to the Dublin market, calling any such policy reversal “a step backwards”.
- Green REIT briefing: Green signed Barclays as a tenant in the One Molesworth St. development and AIB have taken all of Central Park building in Leopardstown. Share price €1.43.
Conor Skehan writes that ‘Only a whole of Government approach can manage housing’, and he is entirely correct. We know that no fewer than 17 state and semi-state bodies already feed into housing policy so a more holistic and integrated approach makes sense. He refers to the use of housing supply alone to deal with the aftermath of the housing crisis as a mistake. Housing, he writes, “does not obey the rules of conventional economics – mainly because of investors… At some point the prices begin to reflect the hopes of investors, rather than what can be afforded by home owners- and a housing bubble begins.” He advocates for the management of housing rather than just focusing on supply.
If you only have time to read one property article today, this is the one I recommend. It’s a sensible read that puts our stage of recovery in context and, arguably, calls for us to re-examine more recent policy changes.
- Fearghal O’Connor reports that builders may take trade unions to court to recover costs related to the recent bout of ‘crane flu’, which I have written about over the last few weeks. Construction Industry Federation chief Tom Parlon came out fighting for his members in response to claims that it takes six months to train as a crane driver by saying “Irish cranes are Mickey Mouse compared to New York or Dubai cranes. We have a maximum height of 12 or 15 stories. It’s not rocket science to drive a crane here.”
Sunday Business Post
The Sunday Business Post is a great read today, if you only pick up one newspaper today, this is the one. There are two special reports, the first is ‘A Tsunami of Repossessions?’ (note the question mark and not just the headline) by Francesca Comyn.
The second special report looks at the Iveagh Market regeneration project in Dublin ‘How a €100 million regeneration project stall : 20 years in limbo’. It makes for interesting reading, not necessarily property-related but it does question the process of community involvement and engagement – it also has the best image that you will see in a newspaper today!
- The property section leads with ‘Lure of the trophy home’ as 230 homes in Dublin so far this year break through the €1m price barrier.
- Karl Deeter has an excellent column ‘The prevailing anti-banker, pro-borrower narrative is avoiding the unpalatable truth’. He writes that of the 11,000 repossessions before the courts last year, only 1,000 orders of repossession were granted. He makes that point that most repossessions are avoidable with some level of engagement by the borrower and that the current media narrative is neither truthful nor helpful.
- Developer Joe O’Reilly has apparently abandoned his €1 billion sky garden dream on Dublin’s north inner city after 20 years.
- Luke and Brian Comer are in early stages of including a 20-storey skyscraper in their Galway city centre mega development, according to Roisin Burke.
- Might Sean Mulryan’s Dublin Landings building be under consideration by the IDA as their new global headquarters?
- The €330,000 sale of the tiny yet iconic Ballsbridge kiosk to Starbucks caused a riot across social media this week by Gillian Nelis asks whether or not this is simply a marketing exercise as industry insiders believe.
- Michael Brennan writes that the government is bringing in emergency legislation to avoid grinding to a halt on development sites in the Dublin commuter belt as extended planning permission times expire. The rushed legislation will further extend the planning for a period of five years.