Seems Like You’re Found a Few Articles Worth Reading

If you want us to keep doing what we do, we’d love it if you’d consider subscribing. We’re a tiny operation, so every subscription really makes a difference.

None of the second round of affordable rentals homes, those known as cost-rentals, funded with help from a government loan scheme will be in Dublin city.

None of the first were either.

“It’s very worrying in the context of Dublin City Council,” says Social Democrats TD and housing spokesperson Cian O’Callaghan.

Seventy percent of new households in the city in the next five years will need ideally either social or affordable homes, said recent research for Dublin City Council.

“It’s the area of the country where cost-rental is needed most,” said O’Callaghan. “I mean, it’s needed everywhere, but there’s an acute need in Dublin city.”

The way the Cost Rental Equity Loan (CREL) scheme has been run so far means that the homes have to be delivered fast and, within the city, meeting the scheme’s timelines for projects has been too tough or, given the way they’re being delivered, would be too expensive.

A spokesperson for the Department of Housing said changes to the CREL scheme due later this year should make projects cheaper and give more leeway with longer timelines.

Also, CREL isn’t the only government scheme supporting cost-rental, they said, with the Land Development Agency committed to building on state lands and grants for councils to help them deliver.

The response to those future changes to the scheme will indicate how effectively government has smoothed the way to scale up cost-rental in Dublin city, or whether other barriers, such as access to affordable land, will continue to dampen numbers.

The Scheme So Far

The government has a target in its housing programme, Housing for All, of an average of 2,000 cost-rental homes a year.

Cost-rental homes, generally, are those for which the rents cover only the financing, building and managing homes, and so should come out cheaper than market rents. Under Ireland’s version of this model, rents can also include, controversially, a bit of profit too.

So far, 911 cost-rental homes have been approved for funding through the Cost Rental Equity Loan (CREL) scheme, said a spokesperson for the Department of Housing earlier this week. People have moved into 65 of those already, in Balbriggan and Leixlip.

Another 44 cost-rental homes funded through CREL were also recently advertised as ready for people to rent in Parklands in Citywest by Tuath Housing, said the department spokesperson.

To be eligible for rounds of CREL funding, projects had to promise to deliver fast.

The first CREL call-out in December 2020, said that at least half of the homes in each proposal had to be scheduled for delivery in 2021. The second call-out in October 2021 also said that a certain number of homes had to be delivered in 2022, said a Housing Agency spokesperson.

It means that all the homes delivered and funded have been what are known as “turnkeys”, where an approved housing body (AHB) – a housing charity – agrees to buy new homes off a private developer with help from the CREL scheme, which it will then rent out for people to live in.

That means the homes are more expensive than if an AHB built them itself and one reason why Dublin city hasn’t yet seen any cost-rentals through the scheme, says Sinn Féin TD and housing spokesperson Eoin Ó Broin.

Forking out money to AHBs to buy homes from the private sector on the open market means layers of profit – on land sales, on finance, the builder’s profit, and the developer’s margin – all bump up the purchase price and so the rents too, Ó Broin said.

In suburbs, AHBs can just about deliver homes under CREL at rents more than 25 percent below market rents – as is required to qualify as a cost-rental home in Ireland – but you can’t do that in urban centres, he says. “It’s just not possible.”

Fiona Cormican, the new business director at Clúid Housing, says that turnaround times are why her AHB hasn’t put forward projects in Dublin city yet.

Even just lining up turnkeys takes time Cormican says. “Projects in Dublin city are hard to get hold of at the best of times. But you can’t turn around and get it overnight either.”

Clúid Housing doesn’t want to buy up stuff that was already headed for the open market as that would take away from home buyers, she says.

It is focused on working with developers on new projects that are specifically for cost-rental, she says. “That are additional to supply, not taking away from supply.”

There was one application to the second CREL round for cost-rental homes in Dublin city, but it failed to tick the box that it had to be delivered in 2022, said a spokesperson for the Housing Agency.

That application came from Circle VHA, for its cost-rental homes at Glebe House, where Dublin City Council has transferred some of its land to the AHB.

Those homes have been slowed down, meanwhile, by local objections, says Russell Grainge, director of property at Circle VHA. “The reason that it wasn’t approved on this occasion was because of delays.”

In May 2021, An Bord Pleanála granted Circle VHA and Seabren Developments Limited permission for 152 apartments on the big site on St Agnes Road in Crumlin.

Half the homeswould be cost rentals, funded through CREL, and the other half social homes, says Grainge.

It would have been ready in 2022 but local residents challenged the planning permission in the High Court and won, said Grainge.

Circle VHA is waiting for the final outcome for the case. But it is likely that the planning application will be resubmitted, he says, and the project done by late 2023 or early 2024.

He isn’t worried about whether or not it will get CREL funding later, he says. “I’m not concerned that it won’t be approved.”

Looking for Changes

Cormican said Clúid Housing has been asking for a rolling call for applications to the CREL scheme with longer timelines to get projects done. “That will completely change everything.”

A spokesperson for the Department of Housing said that that is in the works.

The first calls looked to quick delivery to get the new model up and running, they said. But a new process is being developed, which is more flexible and will mean AHBs can more readily build homes themselves, they said.

That should save money compared to turnkeys and also accommodate projects that are delivered over more years, they said.

Grainge, director of property at Circle VHA, says he doesn’t think there is a simple solution at the moment to the reliance on turnkeys for providing affordable housing.

It is risky for AHBs to directly build new housing too, he says. With turnkeys, the developer takes on the design and the risks of the planning process, he says. “Which may or may not come to nothing.”

When Circle VHA starts to build itself, it will be looking for land with planning permission so it doesn’t have to take on the planning risk. But many others are scrambling for that too, he says.

Ó Broin, the Sinn Féin TD, says he doesn’t think that turnkeys are always a bad thing. “My concern is that turnkeys will continue indefinitely.”

There should be a concrete five-year plan to taper them down and ramp up direct builds, he says, and he doesn’t see that happening.

In the meantime, there should also only be one state agency buying turnkeys to avoid pumping up prices, he says. “You can not have a situation where multiple state actors or actors on behalf of the state are competing for those units.”

Beefing Up the Loan?

At the moment, the low-interest loan through CREL, which is stretched over 40 years, covers up to 30 percent of the capital cost of a cost-rental project.

Cormican, of Clúid Housing, said AHBs have also asked the government to increase the CREL amount because of the challenges of delivering homes at a cost that breaks down into affordable rents.

The Department of Housing spokesperson didn’t directly address the question of whether or not it is looking to increase the loan offered through CREL.

Ó Broin, the Sinn Féin housing spokesperson, says that is a tricky question.“The dilemma is: do you increase that subsidy?”

It is something that the government has to look at, he says, if they want affordable cost-rental homes in city centres in particular.

But if it happens, it would need to be alongside that concrete plan to fade out expensive turnkeys and have not-for-profits build for themselves, says Ó Broin.

Otherwise, “all it means then is that AHBs are buying very very expensive units, cross-subsidised by the taxpayer”, he said.

Looking for Scale

Funding AHBs through the CREL scheme is just one avenue that the government has set up for delivering cost-rentals, said a spokesperson for the Department of Housing.

The Land Development Agency (LDA) is going to build homes on state land, they said. Councils can also get grants to help support their cost-rental projects, they said.

Within the city, they pointed to the roughly 390 cost-rental homes that the LDA has planned at Donore Avenue, also known as St Teresa’s Gardens, and the council’s project including around 375 cost-rental homes at Emmet Road, or St Michael’s Estate.

“These large-scale developments will help deliver a critical mass of Cost Rental homes in central locations where high land costs can make the delivery of Cost Rental more challenging,” said the spokesperson.

Including council, LDA, and AHB projects, there are currently 2,522 cost-rental homes in the pipeline in the city, says a Dublin City Council report from February.

Most of the projects listed – save for the Circle VHA development in Crumlin, down as due in 2023 – are scheduled for delivery in 2025 and 2026, or don’t yet have estimates for when tenants will move in.

Ó Broin, the Sinn Féin TD, says he doesn’t see a plan within the lifetime of this government to move towards a large number of direct-build affordable rental homes. “The LDA’s pipeline out to 2026 is anaemic. It’s very very low.”

O’Callaghan, the Social Democrats TD, says that to scale that up, there needs to be more of a strategy around affordable sites. “It’s hard to see where you’re going to get significant amounts of cost-rental coming from unless there’s a plan around land.”

That strategy, he says, should include zoning land such as church sites and industrial estates in Dublin city for affordable homes.

“That would mean that there would be a supply of land that couldn’t be developed at a full-market cost,” he says. “Affordability and cost-rental would be baked into it.”

And “you don’t end up with a Chivers situation”, says O’Callaghan. Councillors rezoned the old Chivers factory site in Coolock after the landowners promised to quickly build affordable homes. They didn’t and put the site back up for sale.

In November, Social Democrats Councillor Catherine Stocker did propose that Dublin City Council create a new land-use zoning, Z16, which would be a mixed-use zoning, with the majority of the residential development (80 percent) to be social and affordable.

The Office of the Planning Regulator has knocked that idea back, recommending that the council remove it from the new city development plan because it says it clashes with national law.

Cormican, the new business director of Clúid Housing, says that land is a critical issue. “Access to land in our cities is most critical and that’s where we most need the cost rental.”

She too thinks it’s time to consider a social and affordable zoning, she says, one that goes beyond the provisions known as Part V, particularly for land in very high-value areas where long-time communities are being pushed out.

“That would control the land costs there,” she says. “Now it won’t be popular, landowners feel their land is their land. But land gets rezoned all the time.”

A spokesperson for the Department for Housing didn’t directly address what it thinks of the idea of an affordable zoning for land.

They pointed to the changes made in September last year to the Part V rules, which are when developers of bigger housing complexes have to set aside some of the homes or land to sell to the state for social and, now, affordable homes.

Any new planning permission for land bought after August 2021 must allow for 10 percent social housing as before, but also an extra 10 percent of either social or affordable housing which could be cost-rental, they said.

Dublin City Council has not yet agreed any cost-rental homes under the new Part V rules, for land bought post-August 2021 seeking new planning permission, said a council spokesperson.

Lois Kapila

Lois Kapila is Dublin Inquirer's editor and general-assignment reporter. Want to share a comment or a tip with her? Send an email to her at

Leave a comment

Your email address will not be published. Required fields are marked *