Ronan plans to sell €960,000 apartment to council for social housing

CrazyFather1

Pete_Cavan wrote: »

The Government isn't spending €960K on a 88 sq meter apartment. That was offered by the developer but DCC will likely reject the most expensive units taking cheaper ones instead, and negotiate down the price of each unit.

Talking sense....you won't last long around here

Donald Trump

Pete_Cavan wrote: »

The SCSI has more detailed analysis and shows margin at 11%;

https://scsi.ie/business/build/real-cost-to-deliver-analysis/

It also shows land and acquisition costs of 16%.

Donald Trump

Bsharp wrote: »

Any builder or developer looking to get finance from
a bank/financial institution need to demonstrate a level of margin to cover financial risk.

The financers are concerned that the development won't get built, and sold, for them to be paid back. If there are issues during construction the extra cost is covered by the margin without putting the business under immediate financial pressure.

Ideally we would have a more sustainable financing mechanism for home building It could lessen the cost of financing and help reduce the margin.

A major reason why developers are going BTR is they're easier to finance with institutional investors with less redtape, the problem for society is they want to see long-term return through rent; less available to buy. They can also lessen building standards and reduce parking requirements making the build cheaper.

That's not a reason to present it as part of a "re-build cost" which most people understand to be the physical cost of materials and labour.


Every business is the same - they require return for the risk. That is what their profit is for. They don't get to "expense" all the risk into input costs and then also require an additional profit on top of that cost. It is double counting.


If I buy 1 share of AIB for 1 Euro and 1 share of BOI for 1 Euro and come back in a year and AIB is then worth 2Euro and BOI is worth 10 Euro, I can't say that I lost 3 Euro on AIB and made a profit of only 5 Euro on BOI because my required margin was 4 Euro on each which meant that both cost me 5 Euro.


That calculator is giving the price below which the builder thinks it is not worth their while to build - not the actual build costs. And as shown above it includes the land price which is a sunk cost for most developers.

MadYaker

Always amazes when people get so outraged about something that hasn’t happened and isn’t going to happen. Fair play to the indo or whoever created the clickbait headline though, it definitely worked.

Donald Trump

MadYaker wrote: »

Always amazes when people get so outraged about something that hasn’t happened and isn’t going to happen. Fair play to the indo or whoever created the clickbait headline though, it definitely worked.

Who is outraged? And who did the clickbait "work" for?



And why do you think it won't happen? Are you not aware of similar transactions where Councils either bought, or entered into idiotic contracts for housing?

Idbatterim

Pete_Cavan wrote: »

The Government isn't spending €960K on a 88 sq meter apartment. That was offered by the developer but DCC will likely reject the most expensive units taking cheaper ones instead, and negotiate down the price of each unit.

Ah brilliant, we will end up with an average of only 600k per apartment! Do you lads work for dcc?

spurious

Idbatterim wrote: »

Looooooooool! IF they are working , the taxes they contribute at those threshold directly are very little. Then the question is, are they even bothered paying the token gesture rent...

..and yet, we want our offices/shops/jacks clean when we go in. Low paid workers have to live near where they work if they are expected to be there early morning or late at night.

I have no issue at all with a person in low paid employment getting social housing. It's the 'sign me up at 18 and never bother my arse to get a job' types I would send out to some big estate in Westmeath. Sky TV looks the same wherever your 70 inch TV is.

Bsharp

Donald Trump wrote: »

That's not a reason to present it as part of a "re-build cost" which most people understand to be the physical cost of materials and labour.


Every business is the same - they require return for the risk. That is what their profit is for. They don't get to "expense" all the risk into input costs and then also require an additional profit on top of that cost. It is double counting.


If I buy 1 share of AIB for 1 Euro and 1 share of BOI for 1 Euro and come back in a year and AIB is then worth 2Euro and BOI is worth 10 Euro, I can't say that I lost 3 Euro on AIB and made a profit of only 5 Euro on BOI because my required margin was 4 Euro on each which meant that both cost me 5 Euro.


That calculator is giving the price below which the builder thinks it is not worth their while to build - not the actual build costs. And as shown above it includes the land price which is a sunk cost for most developers.

It's an integral cost. The units don't get built otherwise. We can't just ignore the reality that companies need to make a margin/profit to stay in business. It's the actual cost of delivering a house.

SCSI spell the costs out line by line. I'd rather the transparency. By putting the margin separate we can delve into unit costs and hourly labour wages to understand the figures better. Are the wages at cost or with margin bedded in? This depends on subcontracting which plays an important part. Both businesses would need to make a margin need in this instance, driving the cost higher than a one-stop shop. Are there any multi-unit houses builders that don't subcontract?

Presumably the view is that they've a profit margin built into the construction unit costs through salaries as well as the margin itself which is where the double counting comes from? Wages broken out would make this clearer.

The shares point isn't analogous to a business operation and all that comes with filing accounts, governance and staying open.

How we reduce risk to lower margin should be one of the focuses. Even if the government builds the houses this 'cost' still applies if private companies are involved in the process.

PhilOssophy

Its what happens when you are spending somebody else's money.
Easy come, easy go.

Wanderer78

PhilOssophy wrote: »

Its what happens when you are spending somebody else's money.
Easy come, easy go.

whos money, and where did it come from?

jimmycrackcorm

Varik wrote: »

While the government (Dáil) could do a lot about this, it's the councils that are responsible.

Councillors are to the forefront of NIMBY objections. A lot of councils are not majority controlled by FF/FG either.

jimmycrackcorm

Richard Hillman wrote: »

The reality is, the housing crisis is beneficial to all politicians right now. The FG/FF are the parties of developers. The opposition need the crisis to rumble on to try and get elected. Which is why they are objecting to proposals left right and centre.

Always amused to blase comments linking parties to developers without any actual facts. Meanwhile, SF is actually a party of the developers, since they stopped blowing up buildings.

marieholmfan

jimmycrackcorm wrote: »

Always amused to blase comments linking parties to developers without any actual facts. Meanwhile, SF is actually a party of the developers, since they stopped blowing up buildings.

Our current Taoiseach had Owen O'Callaghan's money 'resting' in his account.

Kivaro

On the news yesterday, a report of hundreds of new houses to be built in Limerick. Of course, every one will be social housing or affordable housing, but the majority will be social. Billions upon billions earmarked to be spent on social housing in the years to come. How is this sustainable? How will we be able to pay for all of this with the pandemic debt about to hit us?

Without a shadow of a doubt, there are deserving people like the disabled, chronic sick, pensioners, and others in similar categories who need these houses, but there are substantial groups of people who do not deserve these free or almost free houses. And with the Minister of Children Roderic O' Gorman guaranteeing all asylum seekers their own homes within 3 months of arriving in Ireland, there will be a never-ending demand for social housing. This must be the reason why the only construction currently allowed in Ireland is for essential and social housing projects. What about the construction of houses and apartments for the people working in order to pay for all these social houses?

It seems that the Irish government have their priorities in complete reverse. I do not know if they realise that those getting social houses at the moment have no intention of voting for any of the parties in government. While the workers who are getting screwed do not want to vote for them either because of the unfairness of it all. People who do not work getting new state of the art houses. That's the irony right there.

glenq

45 storeys. Lol.

gourcuff

didnt this issue already get decided?

https://www.irishexaminer.com/business/arid-30927725.html

cant breach the height in the SDZ, therefore this will be thrown out by the courts surely?