Desirable family homes in our cities are in short supply, says ISABEL MORTON

THE BATTLE continues over precise numbers, but it is now accepted that there are at least 300,000 empty homes in Ireland.

It’s somewhat ironic therefore that we have a shortage of well-located family homes coming on the market in the Dublin area.

Last year there was a 17 per cent reduction in the number of properties for sale in the capital and a further shortage of stock is predicted for this year.

There are, obviously, plenty of properties on the market in Ireland at the moment but of the wrong type or in the wrong location.

Despite almost 1,000 repossession orders issued in 2009 (up from 758 in 2008), and the fear that there will be more to follow as over 26,000 homeowners are at least three months in arrears with their mortgage payments, few decent family homes are coming on to the market.

Those hoping to pick up a fire sale bargain might be disappointed as repossessed properties appear, for the moment at least, to be retained by the banks and lending institutions.

We must presume that they are choosing to leave them idle or put them on the rental market in preference to forcing property values to drop further by flooding the market with these repossessed homes.

However, the situation is volatile and is changing on a daily basis.

The news that Halifax is to shed 750 workers will have an effect on the market in Dublin and Louth where it’s closing its customer service office in Dundalk.

Similarly, National Irish Bank intends closing 24 of its 54 branches and Boston Scientific announced that there would be 175 job losses from its Galway operation.

The scale of these redundancies rather dwarfs the small piece of good news heard this week, that the credit bureau database firm Dun Bradstreet (DB) has recently leased offices in Sandyford and announced the creation of at least 100 new jobs, but it proves that there is movement and it’s not all going in the wrong direction.

Presumably this movement will also be reflected within the property sector, if for no other reason than to service those who might need to sell due to redundancy and those who may be in a position to rent or buy, having just secured a new job.

No doubt landlords and vendors in Sandyford, Dundrum, Ballinteer and Stillorgan will be watching with interest.

At the moment you can purchase a three-bedroom home in the area from €300,000 upwards.

Rental prices for a similar property start at around €1,300 per month. As many of the estate agents regularly point out, it is now sometimes cheaper to buy rather than rent, as the monthly mortgage repayments are likely to be less than the rental charges.

However, already we may be short of suitable properties in the area.

Nobody denies the glut of two-bedroom apartments, but unfortunately the few three-bedroom apartments built were never suited to family living due to their size and design.

Unlike many of our European neighbours, we never quite accepted apartments as anything much more than a stepping-stone to the ultimate goal of owning our own house.

The three-bedroom semi-detached family house remains the most popular choice for a wide range of buyers, as it’s neither too big nor too small for most family circumstances.

The bulk of the family homes built in the boom are in satellite towns.

In many cases, despite a lack of transport facilities and basic services, they were considered the only affordable option for families looking to buy a home within reasonable commuting distance of the city. Many of these properties are now included in the “empty homes” statistics, as reduced property prices now permit these families to buy in more central locations.

Hence the ridiculous situation where we have a glut of unwanted family homes in outlying areas and a shortage of desirable family homes in the cities and their immediate environs.

So, why are there so few well-located three-bedroom homes coming on the market?

Well, with the obvious exception of those affected by the three Ds (death, divorce and debt), owners of many of these houses have no good reason to sell at the moment.

Families who might once have considered trading up are now sitting tight. Although they may well be tempted by the low prices now being asked for homes in the next tier up, they are fearful of over-extending themselves at a time of such economic instability. Instead, they might consider extending and renovating but they are unlikely to budge.

Older couples, who might have considered downsizing, will hold off for a while until they feel that there is more confidence and liquidity in the market.