Coalition Framework Document opens the door to rezoning value cap

On April 15th, Fine Gael and Fianna Fáil released the Coalition Framework Document to outline the agenda of the new coalition government. It outlines 10 missions to be undertaken, one of which includes adherence to the New Green Deal and a commitment to carbon neutrality by 2050.

Another is called Housing for All, which aims to reduce the country’s homeless population by empowering the Land Development Agency to build new homes on both public and private lands.

This comes at an unprecedented time in which the security and cost of housing is a critical topic in the eye of the public. In the document, the parties pledge to reduce the cost of land by employing “all measures, up to and including referenda”. Reports also suggest willingness of the parties to adopt recommendations made in the 1973 Kenny Report into the price of building lands. The main recommendation in this report was to cap the price of lands rezoned from agricultural land to residential. The cap recommended that these recently zoned lands could be acquired by local authorities at the cost of their agricultural value plus 25% to reduce the cost of the land itself which is often a barrier to construction.

The most recent estimate from the Chartered surveyors institute (SICI) is an average site cost of €60,000 per residential unit for a semi-detached house, amounting to 20% – 25% of the overall cost. These lands must be serviced following rezoning, which is a cost to both the taxpayer and a further cost burden on housing. The implementation of the measures in the Kenny Report, or similar, would have the effect of both reducing the land element of overall housing delivery cost and redirecting scarce financial resources from land purchase to public infrastructure.

2020-04-30T14:42:34+00:00