Affordable house prices offer hope – but only to some

News that affordable homes would be available in Dublin from as little at €116,000, with three-bed duplexes for a frankly astonishing €176,000, will offer hope to hard-pressed renters that they can finally get on the property ladder.

Some commentators may urge caution about a rush to buy, and will argue instead for a decent public housing programme with long-term secure rental options.

But a couple currently paying more than €1,300 a month to rent a one-bedroom flat, who now have a chance to pay just over €700 a month to own a three-bed duplex in the same area, are likely to tell those well-meaning progressives just where they can stick their cost-rental option.

However, that same couple with their eye on the duplex, or even the one- or two-bed apartment, will find themselves facing serious competition for the homes on offer.

Dublin City Council ‘affordable homes’ starting at €116,000

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Thousands of eligible buyers are likely to be vying for the council’s 370 homes. Ó Cualann Cohousing Alliance, a housing co-operative that is in the process of building an estate of 37 affordable homes in Ballymun under an independent scheme, has a waiting list of more than 1,500 applicants. A scheme with the backing of the State is likely to be even more oversubscribed.

Applicants for the State scheme face another significant hurdle – they must be living in the city council area.

This is where the couple paying €1,300 rent are at least ahead of the game; had they left Dublin city to rent in a cheaper area, they would have no hope of buying one of the homes.

Priority scheme

Councillors last month approved the Government’s “scheme of priority”, which determines how prospective buyers will be chosen, despite acknowledging it would disadvantage workers who have had to leave the capital because of high rents.

Had they not approved the scheme, it may have appeared as they knocked on doors looking for local election support that they had voted against affordable housing, rather than against a badly drafted allocation system.

The order of priority, which councillors did not have the power to alter, would have been tremendously difficult to explain in a two-minute canvassing opportunity.

Essentially, once applicants meet the income limits associated with the scheme, which have yet to be confirmed by the Department of Housing but are likely to be €50,000 for a single applicant and €75,000 for a couple, the basic criteria is that the homes are the right size for the buyer.

However, to narrow down this group the next criterion is that at least one member of the household has to have been living in the council’s area for at least 12 months. It is at this point that you get knocked out of the pool if you had to leave Dublin to rent elsewhere.

School factor

After this, it is narrowed down to those living in the area for at least 12 months who have a child in an educational institution within a set distance of the house for sale. If there are still too few houses, they would go to those who also had a household member with a job a set distance from the house.

Ó Cualann chief executive Hugh Brennan says the scheme is unnecessarily complicated. "We have selection criteria as well, but for us its that 70 per cent of the homes have to go to people who are from, or work in, the local area. Even the wording, the terminology used in the new regulations is very heavy going."

Brennan predicts eager buyers will find their way around the regulations, perhaps using a parent’s address instead of their rental home. But if more thought was put into regulations, which were a year in the drafting, they wouldn’t have to.