Housing shortages still the major hurdle in Cork
Costs Build Building Not Mercially Builders So Apartment That Blocks Are High To It’s For Viable
The lack of quality family-friendly apartment complexes in Cork city, much like all types of accommodation, has become increasingly alarming in recent years.
The underlying problem here has been that apartment building hasn’t been a profitable enterprise for some time.
The Government are now looking to give €120,000 per unit to builders/developers to encourage them to build more apartment units in the hope that that will bridge the difference for them between making a profit or a loss in the provision of a housing unit. It’s a bold move that does offer some hope, but Binesh isn’t so sure:
“As of now, building costs are so high that it’s not commercially viable for builders to build apartment blocks,” confirms Binesh, “but I’m not favourable to that idea because it’s just going to drive the prices up, ultimately.”
He also says that the provision of better services that families need is possibly even more important than getting the apartments built.
Overall, the amount of properties available to rent at the moment falls well short of what is required. Back in 2016, it was just after the economic downturn and there was a glut of properties available to rent. At that point, there were approximately 24,000 properties available nationwide to rent. Today, there are less than 1,000 homes officially available to let.
“That’s just 4% of what it was in 2016,” notes Mark Rose of Rose Property in Douglas, Cork, who wonders if the Government is simply asleep at the wheel in this regard, with all the changes of Housing Minister in recent years. When the Minister changes again next December, it will have been five different ministers in the last six years.
The dire need for more residential units in all their forms is still acute, whether the landlords are large multinational super-landlords or the part-time mama-and-papa landlords.
As shown previously, the vast majority of landlords are in the latter category and it this category that is diminishing. According to the RTB report of last July, there are more property owners/landlords coming into the market but far more of them are leaving it, with a net loss of 2,000 tenancies per year for the last five years.
Air BnB has its part to play in this phenomenon, certainly, but the reasons are often because the part-time landlord tries to take on too much rather than employing the services of a letting agent and/or they feel that the Government doesn’t support them enough.