Wednesday 10 February 2010

No demand for €27m of affordable housing

A SOUTH Dublin local authority has said it has been unable to sell “affordable housing” valued at €27.5 million.

At a meeting of Dún Laoghaire-Rathdown County Council last night, councillors were told 120 affordable properties in Ballinteer, Sandyford, Stepaside, Loughlinstown, Dún Laoghaire, Leopardstown and Dundrum could not be sold despite price reductions.

The properties were acquired by the council under the Planning and Development Acts which required developers to provide 20 per cent of any development to local authorities for social and affordable housing.

The one- and two-bedroom apartments cost €132,000- €180,000, and had been offered to all 1,900 applicants on the affordable housing waiting list. They had also been reduced in price to keep them 20 per cent cheaper than open market value.

The council had subsidised the cost of each unit by €15,000-€30,000 and could not afford to reduce prices any further, councillors were told.

Director of housing Charles McNamara said every effort had been made by staff to increase sales and fast-track closings. But a number of factors were preventing sales. These included difficulties for potential purchasers in securing sufficient, or any, funding from mortgage lenders. The drop in house prices on the open market had also caused problems and applicants were reluctant to commit to a purchase because of uncertainty of employment or because they were waiting to see if market prices dropped further.

“It is now clear there is no interest from affordable [housing] applicants for these units,” Mr McNamara said.

He said the council could consider four options to deal with the unsold homes, including renting the properties to social housing applicants, selling them to a voluntary housing body on the open market, or offering them to affordable housing applicants on a “let-to-buy” basis.

While conscious that no single solution would be suitable to deal with all the unsold properties, Mr McNamara said he was eager to try the let-to-buy option on a pilot basis with up to 20 units. He cautioned councillors that options open to them now might not be available in the future.

Following debate, councillors agreed to consider the council’s proposals at the housing strategic policy committee.

Irish Times

No comments: