Thursday 19 November 2015

Nationwide development rebates needed to solve housing supply crisis

The Government needs to impose the proposed local development charge rebate scheme on a nationwide basis in order to ease the current housing supply crisis, a leading estate agency group has advised.

Failure to recognise that supply problems are not just an issue in Dublin or Cork will do little to alleviate the current impasse which has led to a nationwide accommodation shortage, according to Real Estate Alliance.

“Although the Taoiseach has confirmed that the Government will introduce a local development charge rebate scheme for large housing projects in Dublin and Cork, they are failing to recognise the fundamental supply issues that exist in urban areas nationwide,” said REA Chairman Michael O’Connor.

“Our REA Average House Price Survey has consistently shown the extent to which a lack of supply has driven people out of the housing market and into a crowded rental space across the country.

“In concentrating on urban areas around the country, we have seen micro markets opening up, with specific towns in counties behaving completely differently, influenced by the availability of small numbers of starter homes.

“And further evidence of the nationwide shortage is shown in the recently announced 80% fall in available rental properties compared to this time last year.

“The cause of this nationwide lack of suitable housing supply, especially in three-bedroomed semi detached homes, is that builders cannot yet sell at a profit.

“The average price of a three-bed semi in our Q3 survey was €188,102 – and in simple terms, a builder needs to achieve €200,000 from the sale of a new home to cover the cost of construction.

“There is still a huge gap in the cost of building and bringing a house to the point of sale, and what it can achieve on the open market. Unless that is closed, we will continue to have a national housing crisis in the short term.

“In urban areas around the country, the market value of a house is in the order of €130 to €150 per square foot.

“However, the cost of building and bringing a house to the point of sale varies between €220 to €250 per square foot – a figure that is even higher in Dublin.

“In an environment where such a big gap exists, there is no incentive to start building, and the State must work to close this uneconomic gap.

“We feel that the State ultimately needs to abolish the 13.5% VAT rate on new homes, backed up by introducing the proposed local development charge rebate scheme on a nationwide basis, a combination of measures which will reduce the cost of a new house by €60,000 on average.

“Introducing a zero vat rate on new homes would reduce a €250,000 property to €220,000.

“The €30,000 presently charged on such a house is an inequitable burden on a young couple who are forced to borrow that sum over the life of a mortgage to pay tax.

“Coupled with the rebate on the local development charge should bring a three-bedroomed family home priced at €250,000 down to something in the order of €190,000.

“This will provide an incentive for the supply chain, but the State also needs to look at the effect that the mortgage deposit rules have had on buyer confidence.

“Just as many couples cannot afford to get on the housing ladder, second-time buyers cannot move and free up cheaper properties for new entrants.

“It is now time the Central Bank revisit the rules, raise exemption limits and include second-time buyers.

“We propose that the price ceiling for first-time buyers should be extended to €330,000 – in line with the average values in Dublin and secondly, second-time buyers should be assisted by allowing them to borrow 90% up to €220,000 as the current requirements are too prohibitive.

“Either of our two options will provide stimulus to allow the market to function, but together, they will provide a sensible solution to solving what is a nationwide housing crisis.”

Michael O’Connor of REA O’Connor Murphy, Limerick, was appointed Chairman of Real Estate Alliance at the Alliance’s recent AGM. Eamonn Spratt of REA Spratt, Dungarvan has been appointed as Vice Chairman.


Pic enclosed

Sample caption: Michael O'Connor of REA O'Connor Murphy, Limerick, who was appointed Chairman of the Real Estate Alliance Group at the Alliance's AGM in Limerick.

Available for interview: Michael O'Connor, Chair, Real Estate Alliance, 087 2597034

Media information: Darren Hughes, MediaConsult, 086 293 7037,

Monday 16 November 2015

REA Munster Auction 12th November Results

150 people registered for the REA Munster Auction at the Limerick Strand Hotel including telephone/proxy bidders. 94% of properties were sold at auction with the remaining properties presently under negotiation. Average prices exceeded 35% above the minimum reserves, in particular there was considerable interest in one commercial property at Barrington Street that had a minimum reserve of €200,000 and sold for €337,000. There were multiple bidders on each of the properties indicating strong demand in the Munster region. We have six auctions planned for next year with the first one to be held in February 2016, details to be posted online in December.

Thursday 12 November 2015

REA Munster Auction 12 November 2015

REA Munster Auction 12 November 2015 Results

Lot No.
Knockane, Cappawhite, County Tipperary.
Apt V5, Kingscourt Manor West, Tralee, County Kerry,
Orchard End, Castletown, Pallaskenry, County Limerick,
3 Mill Street, Bruree, County Limerick,
24 Steamboat Quay, Dock Road, Limerick.
32 The Steeples, County Limerick,
Apt 132, City Campus, Block 17, Limerick.
2 Kilmurray Road, Garryowen, County Limerick,
Carigeen, Kill, County Waterford
Apt 35, Parkview Hall, Castleroy, County Limerick
13 Ashbrook Cresent, Ennis Road, County Limerick.
23 Barrington Street, Limerick, County Limerick
Swallows Nest, Limerick Road, Sixmilebridge, Co. Clare
41 Landsdowne Hall, O'Callaghan, County Limerick
High Street, Kilfinnane, County Limerick
Merton House, Merton Square, Kilkee, County Clare
35 Penrose Court, County Waterford
28 Innishannon, Fairhill, County Cork, Ireland
Annagh, Lisnagry, County Limerick
Apt 4, 37 Stephens Street, County Waterford








Monday 2 November 2015

Athlone Lands Sell For Twice The Asking Price

REA Hynes report strong results from their most recent online auction. The firm brought 15 acres of residential zoned lands to market in Cornamaddy, Athlone to market with an AMV of €150,000. The property quickly hit this figure as bidding rose rapidly to €200,000. Bidding then accelerated, blasting through the €250,000 barrier and finishing at €300,000. The property attracted 12 bids in total from 4 different bidder in 3 cities.
Commenting on the auction, Healy Hynes of REA Hynes had this to say. “Todays strong result is an indication of the increased confidence in the markertplace. Over 250 people vewed the property and the auction was watched live from parties in 7 towns and cities. Although house prices in Athlone are still shy of the figure required to make new home building viable, we are hopeful that results like this will encourage more developers back to Athlone and see badly needed new home stock coming on stream.”
The firm were also bringing a 2 bedroom apartment in Inish House, Golden Island to auction on the same day. Mr. Hynes confirmed that this property was sold prior to auction for an undisclosed sum.
“With an obvious number of unsatisfied underbidders from this auction, it is clear that the demand for development land in Athlone is on the upturn.”
Commenting on the online platform itself, Mr Hynes said “By conducting the auction online, we are able to attract buyers from well outside the local area, opening up a much wider market for our clients. Our results throughout 2015 show that the online space is where the market is moving, we have had 100% success with all our online auctions. Properties have exceeded the reserves; in some cases achieving double what was expected.”
Anyone interested in finding out more about REA Hynes online auction platform can contact Healy Hynes on 0906473838 or email: