Nearly 40 per cent of social homes the Department of Housing listed as “built” by local authorities last year were new homes purchased from developers, new figures show.
Figures published last month by the department indicated local authorities built just over 2,000 homes last year. Almost 800 of these were “turnkey” schemes, where local authorities bought houses or apartments in newly built estates, updated department statistics show.
Fianna Fáil housing spokesman, Darragh O'Brien, said the department was using these purchase figures to "paint a better picture" of its progress in developing housing.
The department details the acquisition of second-hand houses by local authorities as a separate category from built housing, as it does with homes leased from landlords under schemes such as the Housing Assistance Payment. However, new home acquisition was listed as part of the new build category.
“What we can now see is there is still an overdependence on acquisitions – on buying houses instead of building them on local authority lands. In a shrunken market local authorities should be building, instead of relying on buying the limited stock that’s there,” Mr O’Brien said.
The acquisition of newly built homes by local authorities was making it more difficult for first-time buyers to get on the property ladder, he said.
“I have had instances in my own area of Fingal where people had been trying to buy a house only to have the local authority buy it out from under them. Local authorities are hoovering up a large portion of new homes instead of building social and affordable housing.”
‘New build’ figures
Across the four Dublin local authorities, the purchase of new homes accounted for just under a quarter of their “new build” figures last year. However, this was significantly higher in some areas of the capital.
In Dublin city, the council built 74 new homes last year, buying almost the same number at 63. Fingal bought more than it built, buying up 92 new homes and building 75.
Dún Laoghaire Rathdown built considerably more than it bought – 120 as opposed to 14. South Dublin built the most, 238 homes, buying just 28.
Several rural local authorities, where house prices remain depressed, bought no homes in newly completed estates but did build houses. Cavan County Council built 12 homes at an average cost of €200,000, buying none. Laois built 33 at an average of €175,000 each and bought none, while Louth bought 23 at an average of €157,000, again buying none. Carlow, Galway, Leitrim, Limerick, Sligo and Westmeath also built but did not buy.
A spokesman for the Department of Housing said the purchase of turnkey homes added to the supply of social housing.
He said Minister for Housing Eoghan Murphy “has said all along that it doesn’t make a difference which way a home is provided, they are all part of the permanent housing stock”.
Architect and housing policy analyst Mel Reynolds said buying instead of building would make sense outside the Dublin area.
“Local authorities are doing the exact opposite of what they should be doing. They are building in areas of low demand, where they could buy at low prices, and buying in high-demand areas such as Dublin where they are competing with private buyers and driving up prices.”
