General Irish Government discussion thread [See Post 1805]

blanch152

Johnny Dogs wrote: »

I don't know if you realise it, but the post Baron made would somewhat tally with what we have been saying.

The post may end with stating that any social housing initiative would result in marginal profits for the govt, not some nice money spinner.

However, a slight marginal profit - with added state owned assets (houses) should be a more sensible outcome than perpetual payments to hotel's and private landlords - with no returns - zilch - nada - zero at the end of the tenancy agreement all day any day.

This is really basic economics here one would have thought.

I don't understand how basic economics concludes that something requiring subsidisation is making a slight marginal profit?

Baron de Charlus wrote: »

The whole point of social housing is that it's subsidised.

ancapailldorcha

Mod: A few bans have been handed out and posts deleted. Keep it civil please.

Geuze

blanch152 wrote: »

Finally, I am fed up of seeing "rebuttals" by those defending local authorities or suggesting it is easy to build houses, but cannot produce a single piece of empirical evidence to back up what they are saying.

In this case, the facts are there in black and white. Local authorities collect very little rent and have high maintenance costs, making the cost of building social housing prohibitive.

I recently had a conversation with a senior council official.

He stated that although not very high, the rental revenue from social houses is welcome.

Bear in mind that the council recoup the capital costs from CG, so if the rents exceed the maintenance, then from the point of view of the LA, the house is producing a surplus.

Of course, the CG has borrowed and/or taxed to cover the capex.

oscarBravo

Edward M wrote: »

I read somewhere that they want a social housing package included in the budget, whereby LAs would buy off the market and subsidise purchases with these houses for 30k to 90k earners...

I'm no economist, but it seems to me that subsidising the purchase of houses will only serve to drive up house prices.

McMurphy

blanch152 wrote: »

I don't understand how basic economics concludes that something requiring subsidisation is making a slight marginal profit?

Guess Geuze cleared it up.

Geuze wrote: »

I recently had a conversation with a senior council official.

He stated that although not very high, the rental revenue from social houses is welcome.

Bear in mind that the council recoup the capital costs from CG, so if the rents exceed the maintenance, then from the point of view of the LA, the house is producing a surplus.

Of course, the CG has borrowed and/or taxed to cover the capex.

Edward M

oscarBravo wrote: »

I'm no economist, but it seems to me that subsidising the purchase of houses will only serve to drive up house prices.

Here's the link to it, I couldn't get it at the time.

https://m.independent.ie/business/personal-finance/property-mortgages/couples-earning-up-to-90000-may-avail-of-new-affordable-housing-scheme-after-budget-37335667.html

James Brown

Edward M wrote: »

Fianna fail taking an approach that seems to support Matt's theories, only in certain areas though.

https://www.irishexaminer.com/breakingnews/ireland/willie-odea-criticised-for-blocking-social-housing-in-limerick-870147.html

I read somewhere that they want a social housing package included in the budget, whereby LAs would buy off the market and subsidise purchases with these houses for 30k to 90k earners and a package of LA house builds also.
It seems that they, or some of them anyway, think these social builds should only be in certain areas though.

You've not read my comments that closely.
I'm 100% against buying off the market. It use to be only done in emergency situations. It's par for the course now and a complete waste.

It's not my proven workable 'theory'. I'm just rehashing old housing policy from the 1930's, you know when we were so wealthy building social housing was easy peasy like...

The only differences from then to today are the will isn't there, we are a far wealthier nation and government don't like private concerns to lose profits, because that's how they measure success it seems, by how well private business is faring. Any crisis be it housing or health is just whingers and chancers.

Buyers grants and rent subsidies are all needed because of the lack of social housing stock.

Willie and Leo on the same page re: housing it seems.

blanch152

Matt Barrett wrote: »

You've not read my comments that closely.
I'm 100% against buying off the market. It use to be only done in emergency situations. It's par for the course now and a complete waste.

It's not my proven workable 'theory'. I'm just rehashing old housing policy from the 1930's, you know when we were so wealthy building social housing was easy peasy like...

The only differences from then to today are the will isn't there, we are a far wealthier nation and government don't like private concerns to lose profits, because that's how they measure success it seems, by how well private business is faring. Any crisis be it housing or health is just whingers and chancers.

Buyers grants and rent subsidies are all needed because of the lack of social housing stock.

Just rehashing old housing policy from the 1930s doesn't mean it will work. Ireland is a different place, the Irish are a different people.

Edward M

Matt Barrett wrote: »

You've not read my comments that closely.
I'm 100% against buying off the market. It use to be only done in emergency situations. It's par for the course now and a complete waste.

It's not my proven workable 'theory'. I'm just rehashing old housing policy from the 1930's, you know when we were so wealthy building social housing was easy peasy like...

The only differences from then to today are the will isn't there, we are a far wealthier nation and government don't like private concerns to lose profits, because that's how they measure success it seems, by how well private business is faring. Any crisis be it housing or health is just whingers and chancers.

Buyers grants and rent subsidies are all needed because of the lack of social housing stock.

Willie and Leo on the same page re: housing it seems.

Let me get this straight if I can.
You don't want housing bought off the private market? Except in emergency situations?
OK, so we don't buy off the market, we build our own stock, wekeep the homeless in emergency accommodation until we get house built for them, however long that may be.
Tell the truth here, that sounds a bit mixed up, id say everyone in the situation of needing a home considers themselves an emergency, I wonder if you tell them they are as they are until such time as their LA gets a house built or refurbished for them how would they react?
I'd say that with your policy ideals the housing crisis is going to last a long long time!

James Brown

Edward M wrote: »

Let me get this straight if I can.
You don't want housing bought off the private market? Except in emergency situations?
OK, so we don't buy off the market, we build our own stock, wekeep the homeless in emergency accommodation until we get house built for them, however long that may be.
Tell the truth here, that sounds a bit mixed up, id say everyone in the situation of needing a home considers themselves an emergency, I wonder if you tell them they are as they are until such time as their LA gets a house built or refurbished for them how would they react?
I'd say that with your policy ideals the housing crisis is going to last a long long time!

You seem very mixed up.
The Homeless and Housing crises need different approaches.
I'm been talking on the housing crisis.
I think buying off the market for social housing should only be an emergency stop gap measure.
Yes, we are currently in a crisis, however more effort seems to be going to utilising the private market policy wise. This does not work. Following these tactics will continue to make the crisis worse. I don't see any reasons it wouldn't. This is all about making renting and buying viable for tax payers caught in the current crisis. It's about a better deal for the tax payer.

Where homelessness crosses paths with the housing crisis requires emergency accommodation. The key word is 'emergency' now it's a crutch flawed housing policy depends upon. This is needed. I do not think policy that creates an ever increasing reliance on it is the way to get free of the need.

Do you think investing in the private industry may turn around at some point? If not do you have any ideas yourself or are things just the way things are, sure what can you do?

blanch152

Johnny Dogs wrote: »

Guess Geuze cleared it up.

Eh no, he didn't. He only pointed out that while local authorities may be making a tiny profit, which explains their interest in it, the State would be at a huge loss overall.

Geuze

blanch152 wrote: »

Eh no, he didn't. He only pointed out that while local authorities may be making a tiny profit, which explains their interest in it, the State would be at a huge loss overall.

The argument is between:

(1) State pay the rent in the private rental market, e.g. HAP, RAS, etc.

(2) State build houses on its own land


This involves a CBA, NPVs, etc.

blanch152

Geuze wrote: »

The argument is between:

(1) State pay the rent in the private rental market, e.g. HAP, RAS, etc.

(2) State build houses on its own land


This involves a CBA, NPVs, etc.

Correct, and I have no issue with that.

There is also the new FF proposal which may offer value for money as well.

The problems of high maintenance, low rent, poor rent collection and extended vacancies mean that building social housing is not the big solution others claim it to be.

Edward M

Matt Barrett wrote: »

You seem very mixed up.
The Homeless and Housing crises need different approaches.
I'm been talking on the housing crisis.
I think buying off the market for social housing should only be an emergency stop gap measure.
Yes, we are currently in a crisis, however more effort seems to be going to utilising the private market policy wise. This does not work. Following these tactics will continue to make the crisis worse. I don't see any reasons it wouldn't. This is all about making renting and buying viable for tax payers caught in the current crisis. It's about a better deal for the tax payer.

Where homelessness crosses paths with the housing crisis requires emergency accommodation. The key word is 'emergency' now it's a crutch flawed housing policy depends upon. This is needed. I do not think policy that creates an ever increasing reliance on it is the way to get free of the need.

Do you think investing in the private industry may turn around at some point? If not do you have any ideas yourself or are things just the way things are, sure what can you do?

I'm not mixed up at all.
You basically are trying to solve a crisis on the back of the taxpayer to save taxpayers money!
The market price for housing is as it is, rents are as high as they are because of lack of years of private builds and investment.
This is not a present govt made issue, this is a consequence of our past financial trouble and virtually unregulated lending policies.
Unfortunately there is no avenue of cheap housing anymore, costs are high, ask anyone associated with building.
Direct housing builds are not the answer, unless you nationalise it all.

blanch152

https://www.independent.ie/opinion/columnists/colm-mccarthy/why-councils-are-unable-to-tackle-housing-37320492.html

"Putting local councillors and planning officials in the driving seat has failed and the Government's new plan is hostage to the same people. If the goal is the resolution of the housing crisis, it is time to accept that local councils are hopelessly conflicted and to curtail their powers."

I could not agree more, the local councils carry the responsibility for the housing crisis.

Geuze

Geuze wrote: »

The argument is between:

(1) State pay the rent in the private rental market, e.g. HAP, RAS, etc.

(2) State build houses on its own land


This involves a CBA, NPVs, etc.

At a simple look:

HAP, RAS, etc add to demand in the private rental sector, so these add to rental price inflation

Building social housing adds to supply in the overall no. of houses

So although building means huge capex, it has the indirect effects of helping to slow rental inflation.

Edward M

Geuze wrote: »

At a simple look:

HAP, RAS, etc add to demand in the private rental sector, so these add to rental price inflation

Building social housing adds to supply in the overall no. of houses

So although building means huge capex, it has the indirect effects of helping to slow rental inflation.

Agreed in principle.
But as a state, with limited borrowing potential, to build the number of houses needed to significantly address the problem would significantly reduce the opex needed for other services.
There has to be a balance somewhere I suppose, but reality is that state builds are unlikely to come close to changing prices.
Stricter regulation and actually decreasing house size and making more density regulatory in certain areas, like within the greater Dublin region for instance on private developments, could have a much more positive affect.

FreudianSlippers

Edward M wrote: »

Agreed in principle.
But as a state, with limited borrowing potential, to build the number of houses needed to significantly address the problem would significantly reduce the opex needed for other services.
There has to be a balance somewhere I suppose, but reality is that state builds are unlikely to come close to changing prices.
Stricter regulation and actually decreasing house size and making more density regulatory in certain areas, like within the greater Dublin region for instance on private developments, could have a much more positive affect.

Agreed - there isn't one solution to this. It's multi-pronged and requires taxation/regulation changes as well as state building and purchasing of property.

Some posters on here (not suggesting Geuze btw) are yearning for some communist ideal state where the state provides all houses and there is no private market - this isn't realistic so some of us have to actually consider what will happen to the market in real life.

blanch152

Edward M wrote: »

Stricter regulation and actually decreasing house size and making more density regulatory in certain areas, like within the greater Dublin region for instance on private developments, could have a much more positive affect.

That would have the biggest effect. The number of units in developments opposed by Dublin City Council far exceeds their ability to actually build units.

James Brown

Edward M wrote: »

I'm not mixed up at all.
You basically are trying to solve a crisis on the back of the taxpayer to save taxpayers money!
The market price for housing is as it is, rents are as high as they are because of lack of years of private builds and investment.
This is not a present govt made issue, this is a consequence of our past financial trouble and virtually unregulated lending policies.
Unfortunately there is no avenue of cheap housing anymore, costs are high, ask anyone associated with building.
Direct housing builds are not the answer, unless you nationalise it all.

Yes I am.
The tax payer can become an investor in property and sell and rent to those fellow tax payers in need and the poor. Monies will be recouped over time. Even if we are breaking even, we'll be saving on hotel and landlord billing. It is a far better policy than buying or renting privately to house the very same people.
The state/LA's could set their own profit margin by selling and renting at reasonable rates based on income. I've gone over this a million times.
If you want to come back at me about arrears, those very same troublesome tenants will be getting put up in private rentals or housing bought off market or even hotels.

Why would private developers lower sale price when the state and LA's are buying off them and speculators, companies and individuals know they have a customer base in tenants subsidised by the state/LA's?
The only way I could see prices lowering is if the customer base dried up.
However the more we rely on HAP and the private market the more we heat up the market and the more we become reliant on HAP and squeeze the working tax payer into reliance on state/LA aid to find a roof.
The state and LA's are feeding the problem.

That's a cop out and an irrelevance. 'It was like that when I got here' won't wash 7 or 8 years in while following and creating policy that has seen the problem get worse year on year and continue as is. 'No quick fix' 'these things take time' granted, we are going in the wrong direction though.
The only way government, local and national can fix the problem using their current logic is to spend a hell of a lot more and increasingly so year on year, on private rentals and buying off a housing market with no need to lower pricing many can't afford.

The state building it's own on it's own land is as cheap as you can get. Reports that DCC have been in talks with property companies about organising housing supply for HAP tenants is gross and indefensible.
Yes we are in crisis, but we are making it worse with such idiocy.

You seem to be suggesting we continue as is, but more so and in higher density?

High density is a good idea from a planning perspective. They'll charge what they like because the tax payer will subsidise any customers/tenants shortfall. More will not necessarily lead to lower pricing.

blanch152

Matt Barrett wrote: »

Yes I am.
The tax payer can become an investor in property and sell and rent to those fellow tax payers in need and the poor. Monies will be recouped over time.

As has been explained already to you, given the high maintenance costs, the low rents charged, the poor rate of collection, the length of time between rentals, as well as the need to pay interest on the borrowings, it simply isn't true that money will be recouped over time.

A proper cost/benefit analysis is needed to see whether the figures hold up. Several independent reports, including the audit report I linked to earlier, have pointed out the issues.

It may well be that the FF proposal of shared ownership for couples earning between 30k and 90k may well be a better solution for the following reasons:

(1) The State has no responsibility for maintenance or finding tenants
(2) The State only has to pay a % of the cost of the house rather than the full cost plus subsidisation which is required in your scheme.
(3) If a house is valued at 300k with building costs of 200k, the State is better off investing 150k in shared ownership than in building its own houses
(4) The proposal is aimed at productive members of society who can't afford their own houses

However, this proposal will also need a serious cost/benefit analysis.

Matt Barrett wrote: »

Even if we are breaking even, we'll be saving on hotel and landlord billing. It is a far better policy than buying or renting privately to house the very same people.
The state/LA's could set their own profit margin by selling and renting at reasonable rates based on income. I've gone over this a million times.
If you want to come back at me about arrears, those very same troublesome tenants will be getting put up in private rentals or housing bought off market or even hotels.

Why would private developers lower sale price when the state and LA's are buying off them and speculators, companies and individuals know they have a customer base in tenants subsidised by the state/LA's?
The only way I could see prices lowering is if the customer base dried up.
However the more we rely on HAP and the private market the more we heat up the market and the more we become reliant on HAP and squeeze the working tax payer into reliance on state/LA aid to find a roof.
The state and LA's are feeding the problem.

That's a cop out and an irrelevance. 'It was like that when I got here' won't wash 7 or 8 years in while following and creating policy that has seen the problem get worse year on year and continue as is. 'No quick fix' 'these things take time' granted, we are going in the wrong direction though.
The only way government, local and national can fix the problem using their current logic is to spend a hell of a lot more and increasingly so year on year, on private rentals and buying off a housing market with no need to lower pricing many can't afford.

The state building it's own on it's own land is as cheap as you can get. Reports that DCC have been in talks with property companies about organising housing supply for HAP tenants is gross and indefensible.
Yes we are in crisis, but we are making it worse with such idiocy.

You seem to be suggesting we continue as is, but more so and in higher density?

High density is a good idea from a planning perspective. They'll charge what they like because the tax payer will subsidise any customers/tenants shortfall. More will not necessarily lead to lower pricing.

The rest of your post is waffle built on a false premise.

Sam Russell

Edward M wrote: »

Agreed in principle.
But as a state, with limited borrowing potential, to build the number of houses needed to significantly address the problem would significantly reduce the opex needed for other services.
There has to be a balance somewhere I suppose, but reality is that state builds are unlikely to come close to changing prices.
Stricter regulation and actually decreasing house size and making more density regulatory in certain areas, like within the greater Dublin region for instance on private developments, could have a much more positive affect.

It costs about €50 k for a site judging by recent sales, both city and suburban.

It costs about €200 k to build a house/apartment (net).

Add to this the margin developers get (16.5%) as reported recently by one of the large developers, then we have the cost of a house at €300 k. Now add the VAT @ 13.5% and we get €340 k.

Now say we build 30% social housing, 30% affordable housing (@ €300K) and the rest at market rate, which say is €425 k. Now for 100 houses, we get €25.5 m for market rate houses, €9 for affordable plus 30 social houses. So we have income of €34.5 million, VAT of €4.6 million, and a direct cost of €25 million. So we have 30 social houses for a net cost of minus €4.9 million.

Some trick. Just by avoiding the developers margin, and building a high proportion of social and affordable houses, but selling the balance at market rate. We avoided putting public money into private pockets.

Now the figures quoted above are based on figures bandied about in the press in recent times, and are likely to be not far out. The mode of operation would be DCC or some Gov agency tenders for builders to build a planned development for a fixed price with a bonus if completed on time. Planning and design would be up to Gov agency or DCC.

Buying from the market is just daft, pushing up prices, and reducing supply. Renting from private landlords is also daft as it creates no new residential space but pushes up rents. Putting people in hotels is not just daft, it is insane.

severeoversteer

don't know why there is such a push to build lots of social and affordable housing, the taxpayer shouldn't have to fork out houses for next to nothing for wasters (I know there are some worthy cases)

Myself and my partner employ between 35-45 people and the reason for the range of 35-45 is because of people we take on in recent times don't want to work and there priorities are to get on housing list and get a 3 bed house and work maybe 10 hours per week while spending most of this time hiding from the boss and waiting at the chance to jump out the gap at a minute to six o clock !

Sam Russell

severeoversteer wrote: »

don't know why there is such a push to build lots of social and affordable housing, the taxpayer shouldn't have to fork out houses for next to nothing for wasters (I know there are some worthy cases)

Myself and my partner employ between 35-45 people and the reason for the range of 35-45 is because of people we take on in recent times don't want to work and there priorities are to get on housing list and get a 3 bed house and work maybe 10 hours per week while spending most of this time hiding from the boss and waiting at the chance to jump out the gap at a minute to six o clock !

If there are too many social houses, they can be sold at full market price, or at a price set for affordable houses. Currently, there is a massive shortage of social houses because there have been few built in the last twenty years, and next to none in the last decade.

FreudianSlippers

Sam Russell wrote: »

It costs about €50 k for a site judging by recent sales, both city and suburban.

It costs about €200 k to build a house/apartment (net).

Add to this the margin developers get (16.5%) as reported recently by one of the large developers, then we have the cost of a house at €300 k. Now add the VAT @ 13.5% and we get €340 k.

Now say we build 30% social housing, 30% affordable housing (@ €300K) and the rest at market rate, which say is €425 k. Now for 100 houses, we get €25.5 m for market rate houses, €9 for affordable plus 30 social houses. So we have income of €34.5 million, VAT of €4.6 million, and a direct cost of €25 million. So we have 30 social houses for a net cost of minus €4.9 million.

Some trick. Just by avoiding the developers margin, and building a high proportion of social and affordable houses, but selling the balance at market rate. We avoided putting public money into private pockets.

Now the figures quoted above are based on figures bandied about in the press in recent times, and are likely to be not far out. The mode of operation would be DCC or some Gov agency tenders for builders to build a planned development for a fixed price with a bonus if completed on time. Planning and design would be up to Gov agency or DCC.

Buying from the market is just daft, pushing up prices, and reducing supply. Renting from private landlords is also daft as it creates no new residential space but pushes up rents. Putting people in hotels is not just daft, it is insane.

...and we totally screw up the market is the part you left out. Government imposed property crash is the stuff of left wing dreams but actual nightmares.

FreudianSlippers

Sam Russell wrote: »

If there are too many social houses, they can be sold at full market price, or at a price set for affordable houses. Currently, there is a massive shortage of social houses because there have been few built in the last twenty years, and next to none in the last decade.

Sorry Sam - you know from Infrastructure that I have almost infinite time for your opinions, but I just can't buy this one on an economic scale. Where do you draw the line on this; what's the monetary scale for those buying "affordable"; what do we do for people that purchased within that scale on the proper market; what do we do for those in negative equity due to this decision... my list of questions goes on, but let's start here.

christy c

Sam Russell wrote: »

It costs about €50 k for a site judging by recent sales, both city and suburban.

It costs about €200 k to build a house/apartment (net).

Add to this the margin developers get (16.5%) as reported recently by one of the large developers, then we have the cost of a house at €300 k. Now add the VAT @ 13.5% and we get €340 k.

Now say we build 30% social housing, 30% affordable housing (@ €300K) and the rest at market rate, which say is €425 k. Now for 100 houses, we get €25.5 m for market rate houses, €9 for affordable plus 30 social houses. So we have income of €34.5 million, VAT of €4.6 million, and a direct cost of €25 million. So we have 30 social houses for a net cost of minus €4.9 million.

Some trick. Just by avoiding the developers margin, and building a high proportion of social and affordable houses, but selling the balance at market rate. We avoided putting public money into private pockets.

Now the figures quoted above are based on figures bandied about in the press in recent times, and are likely to be not far out. The mode of operation would be DCC or some Gov agency tenders for builders to build a planned development for a fixed price with a bonus if completed on time. Planning and design would be up to Gov agency or DCC.

Buying from the market is just daft, pushing up prices, and reducing supply. Renting from private landlords is also daft as it creates no new residential space but pushes up rents. Putting people in hotels is not just daft, it is insane.

Nice kick in the stones for working tax payers: the privilege of handing over 50% of what they earn over 34k plus the privilege of borrowing over 30+ years to fund people paying a pittance in rent living beside them.

Is your proposal better than what we have now? Maybe, but that isn't what we should be using as the benchmark.

Sam Russell

FreudianSlippers wrote: »

Sorry Sam - you know from Infrastructure that I have almost infinite time for your opinions, but I just can't buy this one on an economic scale. Where do you draw the line on this; what's the monetary scale for those buying "affordable"; what do we do for people that purchased within that scale on the proper market; what do we do for those in negative equity due to this decision... my list of questions goes on, but let's start here.

I am not the decider on the scale of who qualifies for 'Social' or 'affordable' housing. That is a political decision. In my mind, social is rented out at market rates less a subsidy based on the income of the renter - based at a percentage of that income. Also 'affordable' is also dependant on income, and is given to people who would qualify for 'social' but want to buy - but as with all such sales would be subject to a claw-back if sold within a decade. This is not to be a give away.

christy c wrote: »

Nice kick in the stones for working tax payers: the privilege of handing over 50% of what they earn over 34k plus the privilege of borrowing over 30+ years to fund people paying a pittance in rent living beside them.

Is your proposal better than what we have now? Maybe, but that isn't what we should be using as the benchmark.

Our tax rates start to ramp up at too low an income, but then do not go up at the very high rates. Those just over the current limits are hit at all sides.

However, that is a different subject. We have a huge national debt due to the bank bail-out that should have been handled differently, but we are where we are.

We need, as well as houses, transport infrastructure, more and better spending on health, better management of the Gardai, etc, etc, etc. Most of all, we need more Gov money to spend on these things.

severeoversteer

Sam Russell wrote: »

If there are too many social houses, they can be sold at full market price, or at a price set for affordable houses. Currently, there is a massive shortage of social houses because there have been few built in the last twenty years, and next to none in the last decade.

lets say the government builds more social houses and then starts dumping them on the private market, who in there right mind would buy a house over 200k beside others that have been ''gifted'' a house.

having developed housing estates before, buyers would look to be shown where the part 5 houses are and make sure they were well away from that area of the estate !


a lot of developers bought out the part 5 clause and added the cost onto the houses so dear and all as the house was, you wouldn't be beside a council house in that estate.

blanch152

Sam Russell wrote: »

It costs about €50 k for a site judging by recent sales, both city and suburban.

It costs about €200 k to build a house/apartment (net).

Add to this the margin developers get (16.5%) as reported recently by one of the large developers, then we have the cost of a house at €300 k. Now add the VAT @ 13.5% and we get €340 k.

Now say we build 30% social housing, 30% affordable housing (@ €300K) and the rest at market rate, which say is €425 k. Now for 100 houses, we get €25.5 m for market rate houses, €9 for affordable plus 30 social houses. So we have income of €34.5 million, VAT of €4.6 million, and a direct cost of €25 million. So we have 30 social houses for a net cost of minus €4.9 million.

Some trick. Just by avoiding the developers margin, and building a high proportion of social and affordable houses, but selling the balance at market rate. We avoided putting public money into private pockets.

Now the figures quoted above are based on figures bandied about in the press in recent times, and are likely to be not far out. The mode of operation would be DCC or some Gov agency tenders for builders to build a planned development for a fixed price with a bonus if completed on time. Planning and design would be up to Gov agency or DCC.

Buying from the market is just daft, pushing up prices, and reducing supply. Renting from private landlords is also daft as it creates no new residential space but pushes up rents. Putting people in hotels is not just daft, it is insane.

Huge caveat to your proposal is that you assume that the State can build houses as efficiently as a developer.

Edward M

Sam Russell wrote: »

It costs about €50 k for a site judging by recent sales, both city and suburban.

It costs about €200 k to build a house/apartment (net).

Add to this the margin developers get (16.5%) as reported recently by one of the large developers, then we have the cost of a house at €300 k. Now add the VAT @ 13.5% and we get €340 k.

Now say we build 30% social housing, 30% affordable housing (@ €300K) and the rest at market rate, which say is €425 k. Now for 100 houses, we get €25.5 m for market rate houses, €9 for affordable plus 30 social houses. So we have income of €34.5 million, VAT of €4.6 million, and a direct cost of €25 million. So we have 30 social houses for a net cost of minus €4.9 million.

Some trick. Just by avoiding the developers margin, and building a high proportion of social and affordable houses, but selling the balance at market rate. We avoided putting public money into private pockets.

Now the figures quoted above are based on figures bandied about in the press in recent times, and are likely to be not far out. The mode of operation would be DCC or some Gov agency tenders for builders to build a planned development for a fixed price with a bonus if completed on time. Planning and design would be up to Gov agency or DCC.

Buying from the market is just daft, pushing up prices, and reducing supply. Renting from private landlords is also daft as it creates no new residential space but pushes up rents. Putting people in hotels is not just daft, it is insane.

100 houses would be nothing like what's needed, nor 1000.
The scale needed would be colossal, and again I ask, where is the type of funding needed going to come from?

McMurphy

Edward M wrote: »

100 houses would be nothing like what's needed, nor 1000.
The scale needed would be colossal, and again I ask, where is the type of funding needed going to come from?

Some of it could come from the much revered National Development Plan.

120 Billion or so earmarked for that isn't there.

Sam Russell

Edward M wrote: »

100 houses would be nothing like what's needed, nor 1000.
The scale needed would be colossal, and again I ask, where is the type of funding needed going to come from?

Well, study the figures. All houses sold are funded privately by their purchasers through mortgages through the banks. It would not be on the Gov balance sheet.

I used 100 houses, but it could be 10,000.

Good loser

Sam Russell wrote: »

It costs about €50 k for a site judging by recent sales, both city and suburban.

It costs about €200 k to build a house/apartment (net).

Add to this the margin developers get (16.5%) as reported recently by one of the large developers, then we have the cost of a house at €300 k. Now add the VAT @ 13.5% and we get €340 k.

Now say we build 30% social housing, 30% affordable housing (@ €300K) and the rest at market rate, which say is €425 k. Now for 100 houses, we get €25.5 m for market rate houses, €9 for affordable plus 30 social houses. So we have income of €34.5 million, VAT of €4.6 million, and a direct cost of €25 million. So we have 30 social houses for a net cost of minus €4.9 million.

Some trick. Just by avoiding the developers margin, and building a high proportion of social and affordable houses, but selling the balance at market rate. We avoided putting public money into private pockets.

Now the figures quoted above are based on figures bandied about in the press in recent times, and are likely to be not far out. The mode of operation would be DCC or some Gov agency tenders for builders to build a planned development for a fixed price with a bonus if completed on time. Planning and design would be up to Gov agency or DCC.

Buying from the market is just daft, pushing up prices, and reducing supply. Renting from private landlords is also daft as it creates no new residential space but pushes up rents. Putting people in hotels is not just daft, it is insane.

First three paras are about okay.

After that the maths is all wrong. Surely the fixed price would include the 16.5% margin etc etc.

Edward M

Sam Russell wrote: »

Well, study the figures. All houses sold are funded privately by their purchasers through mortgages through the banks. It would not be on the Gov balance sheet.

I used 100 houses, but it could be 10,000.

I wonder about your figures.
You include tax savings, tax the govt gets anyway so their inclusion is meaningless really.
Also the pricing, if the govt were to be seen to be building for profit how would that sit with competition rules?
The cut off for qualification for the subsidised housing is also a point that would interest me.
Take the FF proposal, I think its €90000.
So Tom and Biddy earn €90000, Pat and Mary earn €91000, couple 1 end up with a mortgage of €300000, couple 2 with a mortgage of €425000, which of them is now the better off couple?
I think if the govt were to actually do this and borrow off the books, they would have to set up a company, like IW for instance, they could call it IBC or something, but anyway you get the idea.
While the figures work on paper, I wonder how it would go in practice?

I did a quick check on the KBC mortgage checker.
Couple on the lower mortgage are now saving €6772 over the couple on the higher mortgage!
Way to go Sam!

Sam Russell

Edward M wrote: »

I wonder about your figures.
You include tax savings, tax the govt gets anyway so their inclusion is meaningless really.
Also the pricing, if the govt were to be seen to be building for profit how would that sit with competition rules?
The cut off for qualification for the subsidised housing is also a point that would interest me.
Take the FF proposal, I think its €90000.
So Tom and Biddy earn €90000, Pat and Mary earn €91000, couple 1 end up with a mortgage of €300000, couple 2 with a mortgage of €425000, which of them is now the better off couple?
I think if the govt were to actually do this and borrow off the books, they would have to set up a company, like IW for instance, they could call it IBC or something, but anyway you get the idea.
While the figures work on paper, I wonder how it would go in practice?

I did a quick check on the KBC mortgage checker.
Couple on the lower mortgage are now saving €6772 over the couple on the higher mortgage!
Way to go Sam!

I am not a politician and I would not set the thresholds. You are right that those above the threshold do come out very badly, but the Gov can ameliorate that sudden cut off as they have in the past by allowing tax credits against those extra costs for those that find themselves on the wrong side of it.

The basic idea is to fund social housing by selling the rest of the development through private mortgages, and recycling the VAT element, while 'selling' state land.

The main point is that houses must get built and that a large portion of them should be social houses.

James Brown

severeoversteer wrote: »

don't know why there is such a push to build lots of social and affordable housing, the taxpayer shouldn't have to fork out houses for next to nothing for wasters (I know there are some worthy cases)

Myself and my partner employ between 35-45 people and the reason for the range of 35-45 is because of people we take on in recent times don't want to work and there priorities are to get on housing list and get a 3 bed house and work maybe 10 hours per week while spending most of this time hiding from the boss and waiting at the chance to jump out the gap at a minute to six o clock !

This isn't the case though.
Currently you are paying to buy new houses off the market to house the very same people.
As for the 'wasters' and those who 'don't want to work', how many are we talking and how are they dodging getting caught out? Didn't Leo run some PR thing on that very issue?
You can fund state builds used as social housing for fellow tax payers on low income or you can fund buying social housing off the market at the going rate or cheap loans for private developers to do same. Your choice.
The majority of your post is anecdotal tosh. It smacks of PR for current failed policy using blarney as it's basis. Even your story suggests the current system is flawed. Enjoy paying the Gresham to put up people who don't want to work.

James Brown

christy c wrote: »

Nice kick in the stones for working tax payers: the privilege of handing over 50% of what they earn over 34k plus the privilege of borrowing over 30+ years to fund people paying a pittance in rent living beside them.

Is your proposal better than what we have now? Maybe, but that isn't what we should be using as the benchmark.

Do you think buying houses off the market to house the same people is a better way to go?

We can be saving money and building housing stock. Instead we are funding the private profits of Landlords and developers. Keep the economy going sure.

christy c

Matt Barrett wrote: »

Do you think buying houses off the market to house the same people is a better way to go?

We can be saving money and building housing stock. Instead we are funding the private profits of Landlords and developers. Keep the economy going sure.

Any reason why you ignore where I said that we shouldn't use the current model as the benchmark? And why you ignore where I said his proposal is possibly better than the current setup?

James Brown

christy c wrote: »

Any reason why you ignore where I said that we shouldn't use the current model as the benchmark? And why you ignore where I said his proposal is possibly better than the current setup?

I didn't ignore anything. I've not seen it. There's no tit for tat one-upmanship on my end.
You haven't answered the question I posed in relation to your post I fully quoted.

Do you think buying houses off the market to house the same people is a better way to go?

You are complaining about spending money on building housing for people while we spend money to buy housing for the same people.
If you are not in favour of current policy, what do you suggest, surely (edit: building affordable and social) it's a move in the right direction?

christy c

Matt Barrett wrote: »

I didn't ignore anything. I've not seen it. There's no tit for tat one-upmanship on my end.
You haven't answered the question I posed in relation to your post I fully quoted.



You are complaining about spending money on building housing for people while we spend money to buy housing for the same people.
If you are not in favour of current policy, what do you suggest, surely (edit: building affordable and social) it's a move in the right direction?

Perhaps try reading the post you quoted- "Is your proposal better than what we have now? Maybe, but that isn't what we should be using as the benchmark.". Where I say exactly that we shouldn't use what we have now as the benchmark and maybe his proposal is better.

In the post you quoted, I complained about the proposal by Sam Russell where the cost of social housing would be bourne solely by the people buying houses. House buyers would be financing social housing through their mortgages under his method, which I definitely don't agree with.

As regards your question, I had already said that his method might be better. I don't really know, but I would see both of them as a fairly crappy deal for working taxpayers.

So yes, I am against the current system. What I would try is only housing those who need to be housed in the cities. Without trying to sound stereotypical, that would mean no Margaret Cash in Dublin. Now, I've no idea how many Margaret Cash's there are and how much overall difference it would make, but not allowing such blatant milking of the system would make any other proposal an easier sell to taxpayers (including social housing).

Second, but more importantly, is an overhaul of planning. The docks and along Luas lines should all have high rise, which has the added benefit of reducing commute times, traffic. And more homes = lower prices.

Maybe the planning thing wouldn't work but I think it would be worth a try. If it didn't work we might have to try something else like social housing, despite the obvious drawbacks (welfare traps, rent based on income which would make even more of after tax pay rises disappear, social issues in some circumstances, etc.).

Sam Russell

christy c wrote: »

In the post you quoted, I complained about the proposal by Sam Russell where the cost of social housing would be bourne solely by the people buying houses. House buyers would be financing social housing through their mortgages under his method, which I definitely don't agree with.

As regards your question, I had already said that his method might be better. I don't really know, but I would see both of them as a fairly crappy deal for working taxpayers.

Well, if you accept the requirement for social housing for those unable to provide housing from there own resources, then it has to be paid for by someone.

My proposal is not to get mortgage holders to pay for it - not atall.

Currently the Gov is purchasing houses from the market that has had the effect of pushing up prices, which has the effect that purchasers are paying higher prices and so higher mortgages.

Paying for hotels is madness and should cease, but we need homes. So build them but in mixed developed estates as is current policy, so they must be built by someone. Who builds them effects the price, and my scheme minimises the cost.

The prices paid be purchasers are market prices, and extra new houses reduces the market price, so no-one misses out. The proportions of the three types of housing is a political decision, and getting the proportions right is the way to solve the current crisis.

James Brown

christy c wrote: »

Perhaps try reading the post you quoted- "Is your proposal better than what we have now? Maybe, but that isn't what we should be using as the benchmark.". Where I say exactly that we shouldn't use what we have now as the benchmark and maybe his proposal is better.

In the post you quoted, I complained about the proposal by Sam Russell where the cost of social housing would be bourne solely by the people buying houses. House buyers would be financing social housing through their mortgages under his method, which I definitely don't agree with.

As regards your question, I had already said that his method might be better. I don't really know, but I would see both of them as a fairly crappy deal for working taxpayers.

So yes, I am against the current system. What I would try is only housing those who need to be housed in the cities. Without trying to sound stereotypical, that would mean no Margaret Cash in Dublin. Now, I've no idea how many Margaret Cash's there are and how much overall difference it would make, but not allowing such blatant milking of the system would make any other proposal an easier sell to taxpayers (including social housing).

Second, but more importantly, is an overhaul of planning. The docks and along Luas lines should all have high rise, which has the added benefit of reducing commute times, traffic. And more homes = lower prices.

Maybe the planning thing wouldn't work but I think it would be worth a try. If it didn't work we might have to try something else like social housing, despite the obvious drawbacks (welfare traps, rent based on income which would make even more of after tax pay rises disappear, social issues in some circumstances, etc.).

I believe we would recoup over time and save the tax payer by building. The only other ideas I'm aware of, which we currently practice serve only to heat the market and keep those in throws of the crisis reliant on the state, including the majority who are working tax payers. We've people still posting like everyone affected by the crisis dodges work and sponges off the state.

I think moving people around the country is a bad idea and feeds into the drive to keep the land in areas deemed prime, for the wealthy and companies who speculate making on the misery of others. The regeneration program only served to free up neighbourhoods for private property speculators with a percentage going to communities. This was the publics land. Now it's seen as profit making while we pay for landlords and hotels.
I don't think moving families to another county because the LA's and state want to sell off public land is fair. Of course there's an element of the market driving the work force to relocate due to work and pricing but the LA's and State are queering the market with their interference IMO. I blame them for a market where the seller sets his own price and the tax payer ponies up any shortcomings on the side of the customer with rent subsidies and grants, all of which are needed of course because pricing is so high for most.

As regards High-Rise, great if they are affordable. More over priced and out of reach housing won't help. They'll likely be picked up by landlord renting companies for the state to rent.

I think even if the government put as much effort into social and affordable housing as they do aiding and assisting private developers, vulture funds and other property speculators, we may not solve the problem but it would not be getting worse.

There are thousands of homes previously social housing were the council received rents for decades and then sold on the houses. The councils did not lose out on this deal by any stretch and families were housed with no hotel or private landlord bills. It's just people seem to think we should be gouging the tax payer to make profits, to what end, considering the cost of maintaining the housing crisis, I don't know.

christy c

Sam Russell wrote: »

Well, if you accept the requirement for social housing for those unable to provide housing from there own resources, then it has to be paid for by someone.

My proposal is not to get mortgage holders to pay for it - not atall.

Currently the Gov is purchasing houses from the market that has had the effect of pushing up prices, which has the effect that purchasers are paying higher prices and so higher mortgages.

Paying for hotels is madness and should cease, but we need homes. So build them but in mixed developed estates as is current policy, so they must be built by someone. Who builds them effects the price, and my scheme minimises the cost.

The prices paid be purchasers are market prices, and extra new houses reduces the market price, so no-one misses out. The proportions of the three types of housing is a political decision, and getting the proportions right is the way to solve the current crisis.

Maybe I picked up what you were saying incorrectly but I thought the basic principle was that in any estate, that the houses sold at market value would fund the social houses in that estate? Therefore those that take out the mortgages to pay market rate would be funding them? Apologies if I made a error.

I would accept the need for social housing if amending the planning and other regulations did not work, but this hasn't been tried yet.

Edward M

Sam Russell wrote: »

Well, if you accept the requirement for social housing for those unable to provide housing from there own resources, then it has to be paid for by someone.

My proposal is not to get mortgage holders to pay for it - not atall.

Currently the Gov is purchasing houses from the market that has had the effect of pushing up prices, which has the effect that purchasers are paying higher prices and so higher mortgages.

Paying for hotels is madness and should cease, but we need homes. So build them but in mixed developed estates as is current policy, so they must be built by someone. Who builds them effects the price, and my scheme minimises the cost.

The prices paid be purchasers are market prices, and extra new houses reduces the market price, so no-one misses out. The proportions of the three types of housing is a political decision, and getting the proportions right is the way to solve the current crisis.

There is merit in your proposal, but how about making the purchase price of anyone that buys incremental on how much they earn?
Say those that qualify are made to take the maximum mortgage their earnings allow and even if that's not the full purchase price, put a stipulation in that if they decide to move on or up they must sell back to the state at the original price.
I can see problems for those who purchase at the full market price if they decided to move on or up and are trying to recoup their money, if someone else is selling on the open market and are prepared to sell at the lower price they paid at the same time.
Perhaps everyone should have a mortgage as opposed to rent and make it that the bottom price is the full building cost but the mortgage can be lifetime mortgage and carried on by another family member when the original purchaser is no longer able or around to pay.
This would perhaps make purchasers take more care of what would be a family investment really and cut out the need for state maintenance.

christy c

Matt Barrett wrote: »

There are thousands of homes previously social housing were the council received rents for decades and then sold on the houses. The councils did not lose out on this deal by any stretch and families were housed with no hotel or private landlord bills. It's just people seem to think we should be gouging the tax payer to make profits, to what end, considering the cost of maintaining the housing crisis, I don't know.

I'm not going to respond to each point individually, but all that ignores the problems I mentioned with social housing: welfare traps, disincentives to work, social problems, subsidising private profit, etc. As I said I'm not a fan of the current setup, I think we should try the high rise option, regulations... To borrow your phrase, it may not solve things but I don't think it would make it worse.

Sam Russell

Edward M wrote: »

There is merit in your proposal, but how about making the purchase price of anyone that buys incremental on how much they earn?
Say those that qualify are made to take the maximum mortgage their earnings allow and even if that's not the full purchase price, put a stipulation in that if they decide to move on or up they must sell back to the state at the original price.
I can see problems for those who purchase at the full market price if they decided to move on or up and are trying to recoup their money, if someone else is selling on the open market and are prepared to sell at the lower price they paid at the same time.
Perhaps everyone should have a mortgage as opposed to rent and make it that the bottom price is the full building cost but the mortgage can be lifetime mortgage and carried on by another family member when the original purchaser is no longer able or around to pay.
This would perhaps make purchasers take more care of what would be a family investment really and cut out the need for state maintenance.

Too complicated both in concept and also in administration.

My proposal is to pay for social housing by the 'sale' of state land, by avoiing developer margin, and recycling the VAT element on houses.

severeoversteer

Matt Barrett wrote: »

This isn't the case though.
Currently you are paying to buy new houses off the market to house the very same people.
As for the 'wasters' and those who 'don't want to work', how many are we talking and how are they dodging getting caught out? Didn't Leo run some PR thing on that very issue?
You can fund state builds used as social housing for fellow tax payers on low income or you can fund buying social housing off the market at the going rate or cheap loans for private developers to do same. Your choice.
The majority of your post is anecdotal tosh. It smacks of PR for current failed policy using blarney as it's basis. Even your story suggests the current system is flawed. Enjoy paying the Gresham to put up people who don't want to work.

I must admit that leo really tightened the screw with his PR thing!! :rolleyes:

you say tax payers should fund this and fund that! I don't think anyone should be subsidising homes for others, people stuck in bedsits and living in tenement like situations should be motivated enough to get there sh1t in order and better themselves by working hard like everyone else, there is a bit of merit in tough love, don't let them sleep on streets but don't give them a safety net that lasts a lifetime.


for people struggling to purchase first home in new developments a reduction in vat would be a good idea, but on a vat back scenario,

savings should be incentivised more by the government, like an ssia scheme

quick solutions to housing problems will never be looked back on as being good decisions.

also, hate to burst your bubble but if your the matt barrett I know, you don't have any experience in property development.

Edward M

Sam Russell wrote: »

Too complicated both in concept and also in administration.

My proposal is to pay for social housing by the 'sale' of state land, by avoiing developer margin, and recycling the VAT element on houses.

That wasn't your proposal at all, your proposal was to sell houses at market rates to some and at a greatly reduced rate to others, who if they were cute hoors could sell on again in a few years at the market rate.
If you think people wouldn't take advantage of that then you are more trusting than me.
Either that or the people who paid the higher price would quickly find themselves in negative equity.

James Brown

Edward M wrote: »

There is merit in your proposal, but how about making the purchase price of anyone that buys incremental on how much they earn?
Say those that qualify are made to take the maximum mortgage their earnings allow and even if that's not the full purchase price, put a stipulation in that if they decide to move on or up they must sell back to the state at the original price.
I can see problems for those who purchase at the full market price if they decided to move on or up and are trying to recoup their money, if someone else is selling on the open market and are prepared to sell at the lower price they paid at the same time.
Perhaps everyone should have a mortgage as opposed to rent and make it that the bottom price is the full building cost but the mortgage can be lifetime mortgage and carried on by another family member when the original purchaser is no longer able or around to pay.
This would perhaps make purchasers take more care of what would be a family investment really and cut out the need for state maintenance.

I believe that's pretty much how affordable housing works. You need be in a particular income bracket and as with purchasing your rented council home there's a claw back if you sell within a particular window.
Generally these estates are kept 100% affordable, this does away with a neighbour paying full market rate while next door was given a cut.