Monday 19 March 2007

Green Party policy forcing young couples out of city centre

Planners want larger apartments, but the property sales industry findsa them hard to sell. As a result, we get articles such as this one:

KEN MacDonald, MD of Ireland's largest apartment and new homes estate agency Hooke & MacDonald, has accused the Green Party and certain city council planners of binning the Department of Environment draft guidelines on residential unit sizes that were issued only in January.

As result, Ken MacDonald has told the Sunday Independent that the latest moves by Dublin City Council to increase minimum sizes of apartments is going to add further to the affordability problems by forcing people to buy further out as city centre living will become the preserve of the rich.

Current building and site costs in the city dictate that an 850-900 sq ft, two-bed apartments will have to achieve on average €640,000 and a 1,200 sq ft, three-bed apartment will have to achieve €850,000-€1m, depending on location.

These prices alone are clearly out of the range of most first-time buyers and young families particularly when further significant interest rate hikes are imminent.

Ken MacDonald says that "families have not, to date, purchased a significant number of apartments in the city centre even in very high quality developments, despite the fact that three-bed units have been available, but end up being slowest to sell and then mainly to investors for letting purposes.

"Better facilities for children in city developments are urgently needed, improved landscaping and open spaces, underground car parking, higher ceilings, study & play areas.

"These measures will help to attract families in. To push homes beyond their financial capability by increasing sizes unrealistically is counter productive.

"It will not work," said MacDonald.

He may not be alone in his analysis. There is now real cause for concern about a number of stumbling blocks that are hindering development in Dublin.

There has been a 100pc downturn in planning permissions in Dublin over the past two years - from 24,000 in 2004 to 12,000 in 2006 - at a time when demand is accelerating.

When the shortage of undeveloped land in the capital is added, the situation is likely to drive up the cost of housing and put it beyond the reach of many more people.

"An Bord Pleanála are churning refusals out on a daily basis oblivious to the effect it has on new home prices and aspiring home owners," Mr MacDonald said.

"By unnecessarily increasing the size and price of accommodation, we are discriminating against the biggest category of occupiers in the city - namely single people and couples who between them make up at least 49pc of the total city population."

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