Concerns raised over projected prices of new houses in Kilkenny's western environs

'LIHAF was to provide a large number of affordable houses for individuals and couples on middle incomes'

Sam Matthews

Reporter:

Sam Matthews

Email:

sam.matthews@kilkennypeople.ie

Work on Kilkenny's western environs was to begin by end of year

Over €5 million in funding was announced under the Local Infrastructure Housing Activation Fund (LIHAF) to provide the infrastructure required to enable development of 800 houses in the area

The new houses due to be built in the city’s western environs could cost between €220,000 and €275,000 according to estimates from the Department of Housing.

The projections are based on the ‘estimated average cost of a three bed house in 2017 as provided by the local authority’. However, the figures have prompted skepticism from one local councillor, who says the costs hardly meet the definition of ‘affordable housing’ for many people.

In March last year, over €5 million in funding was announced under the Local Infrastructure Housing Activation Fund (LIHAF) to provide the infrastructure required to enable development of 800 houses in the area between the Callan Road and the Kilmanagh Road. Under LIHAF, project costs are shared on a 75:25 basis between the Central Government and the local authority.

At last week’s meeting of Kilkenny County Council, members heard that agreement has been reached with developers to provide €3,000 per house constructed. This will be aggregated, so that, for example, if ten houses are constructed, this would net a €30,000 reduction for someone on the affordable housing list. Director of Services Tim Butler told the meeting that this would be in addition to any PartVs.

However, local councillor Patrick McKee says that the figures involved are still prohibitive in many cases.

“Under no circumstances is this affordable,” he told the Kilkenny People.

“It would mean that, as per current central bank rules which allow a borrower to borrow 3.5 times his/her/their income, and taking the median selling price of €250,000, a home purchaser would need to be earning at least €70,000 per annum to buy one of these homes.

“Even with this the price of a home will be €210,000 plus — and I suspect it will be much higher given the continuing lack of supply here in Kilkenny — and, there will be nowhere near enough such homes available.”

The local councillor says that due to the significant public monies involved, the LIHAF was to provide a large number of affordable houses for individuals and couples on middle incomes (€36,000 - €60,000), in addition to the social housing under Part V.

“Essentially those on middle incomes don’t qualify for social housing supports, nor are they able to access housing on open market as there is a chronic lack of supply and also, as they don’t earn enough,” he said.

“Heretofore they have been left out in the cold by Government with no options available to them other than to live at home with family or pay skyrocketing rents. LIHAF was supposed to deal with this. It won’t.”

Cllr McKee also raised concerns over the speed of delivery of the project, given the target date for the housing to be built is 2021. Works were initially due to begin before the end of 2017, however, the e-Tender bidding process on Phase 1 of the project began in January, and ended in February 2018.