As apartment all in delivery costs are high many schemes would not be started in the absence of institutional funders and purchasers
Lots of discussion over the past week on whether #apartments should have been included in new planning permission conditions & owner occupier guarantee.
The all in cost of apartments is higher than an equivalent sized house and there are a lower number of purchasers that can afford an apartment.
Institutional investment has a role to play in supporting new supply, particularly in delivering high density apartments that would otherwise not be built.
Delivering houses and apartments by the State at a lower cost will require an amount of subsidy in addition to efficient procurement & delivery - there will also be a significant lead in time to delivery of the homes.
There is no doubt that a mix of #publicsector and #privatesector delivery of homes is going to be required to target delivery of 35,000 homes per year. There are a number of sequential steps and approvals that ensure public delivery gets value for the State's money and that the #procurement is open to as wide a range of providers as possible. The reality is that starting with site ownership and with a very efficient process it takes time - the public supply tap cannot be turned on and houses provided tomorrow. How the State provides homes in the interim period will require a number of approaches including #procurement of homes through lease and purchase from the market. A situation where local authorities, AHBs and other agencies are bidding against each other or individually negotiating and driving up prices does not get good value - this needs to be thought through.
A more detailed analysis of the comparison between the public and private approach is given in this post - www.keoconsult.com/knowledge/housing-procurement-delays-key-is-the-duration-of-the-project-governance-process-not-the-procurement-process
Calculating from the CSO's latest figures the trend in planning permissions obtained but not commenced for apartment and multi housing development has been increasing for some time. In the face of demand exceeding supply by a significant factor the ongoing delay in projects starting can be attributed to viability issues, lack of funding or simply developers looking to sell on ready to go sites. Interventions that further impact on viability, reduce the level of funding in the market or increase the cost of ready to go sites are not going to get parked projects moving.
Keogh Consulting looks to help individuals and organisations deliver the right projects the right way. Here is some of our knowledge and a few case studies that we hope will help you on your project journey.
Project Cost Calculator & Database
Cost Rental Simple Model
Cost Rental Complex Model