City council can pay up to €704k for private homes it wants for social housing

DUBLIN City Council has been told it can pay up to €704,000 when buying private properties for social housing, potentially pricing private buyers out of the property market.

The figure comes from a circular seen by the Irish Mail on Sunday that was sent by the Department of Housing to the local authority. .

The spending limits have been branded as ‘outrageous’ by experts and politicians given the number of houses that could be built on council-owned land for considerably less money.

The council has accelerated the purchase of homes for social housing, buying 306 so far this year, according to data released to the MoS under Freedom of Information (FOI) laws. This is up significantly on 226 homes bought in all of 2018, 168 in 2017 and 148 in 2016.

The Department circular issued in April to the council sets out what is allowed to be spent when buying up properties. Included is a ceiling figure for a one-bed apartment of €404,800 with an average of €289,150.

Housing expert and architect Mel Reynolds said the spending guidelines were ‘monstrous’ given what could be built for the same price on council-owned land.

He told the MoS: ‘I’m shocked by these numbers – the upper price for a one-bed apartment is €404,800, that’s monstrous when we know it can be done for €180,000.’

Mr Reynolds said the council had 112 hectares of vacant land with capacity for 15,000 dwellings, but has only declared about 10% of that on the vacant sites register.

‘Why are they buying when they have all this land?’ he said.

Mr Reynolds referenced the work being carried out by Ó Cualann, a building co-operative for affordable housing. According to its latest pricings for November 2019, it can build new homes for an average €237,160.

The MoS previously highlighted the story of a home purchased in Drimnagh in turn-key condition by the council. It had been fully refurbished in 2014 by the previous owners with a Building Energy Rating of C2. Despite its beautiful condition, the home was gutted and completely refurbished to keep at a specific city council standard.

‘They have a rule that all their homes have to be of the same standard,’ Mr Reynolds said. ‘They strip perfectly good homes and put their standard stuff in it.’

Councillor Mannix Flynn told the MoS there was a severe lack of oversight in the council’s acquisition of properties, and said it was necessary for an independent body to take up this supervisory role.

‘Two years ago, I asked the city council for clarity and transparency on this,’ Mr Flynn said. ‘I was told it was private and commercial. I couldn’t get a list of the properties that Dublin City had bought. I couldn’t get what they actually cost or the evaluation on these houses, the architectural study on these houses to do them up, who was going into these houses and what the procurement process was.

‘There’s a question to be asked at council level and there’s a question to be asked by the Public Accounts Committee.’

Dublin City Council refused to disclose under FOI legislation the prices, BER ratings, safety assessments or locations of the properties it had bought. It said it would be unable to comment on this story until Monday. Housing Minister Eoghan Murphy did not return a request for comment.

‘The upper price for a one-bed is monstrous’