Cost of new houses in Dublin could be cut by €30,000, Dáil told

The cost of a new three-bed semi-detached house in Dublin could be cut by about €30,000 with the implementation of legislation for the compulsory purchase development land, the Dáil has heard.

Labour Party leader Alan Kelly introduced a Bill to give local authorities the power to acquire land through compulsory purchases for agricultural value, plus 25 per cent, which he said was based on the Kenny report produced 48 years ago.

He said the Bill is not a “silver bullet” for the housing crisis, but a “ major step in the right direction”.

However a Government amendment expected to be accepted in a vote later on Wednesday night will delay further consideration of the Bill for 12 months.

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This is on the grounds that it would be “premature” as a final Law Reform Commission report is expected by the end of the year on compulsory purchase order laws.

The Kenny report was published in 1973 after then Fianna Fáil minister for local government Bobby Molloy sought recommendations for ways to tackle the supply of development land.

The document was produced by a committee led by High Court judge Mr Justice John Kenny and contained a “set of radical recommendations to help solve Ireland’s housing problems”, Mr Kelly said.

The recommendation of compulsory purchase of greenfield sites at their existing value plus 25 per cent “is simple but effective”, he said.

The measure “which has been opposed by Fianna Fáil and Fine Gael for generations, would immediately have ended the ability of land hoarders and speculators to make enormous profits at the expense of first-time buyers.

“If implemented, there may never have been a property bubble and a collapse, nor a housing crisis or anything like it at the scale that exists today.”

Price reduction

Mr Kelly said the land component of a newly built house in the greater Dublin area is about €53,000 or 16 per cent of the final cost but if implemented, the Acquisition of Development Land (Assessment of Compensation) Bill “will reduce the cost of a new-build three-bed semi-detached house, built on a greenfield site in the greater Dublin area by approximately €30,000”.

His party colleague Brendan Howlin said that for as long as he had been in politics, whenever housing policy was debated, mention was made of the Kenny report.

Mr Howlin said it was the third time the Labour party was attempting to legislate for the Kenny report’s recommendations, which they had done previously in 1990 and 2003.

“I believe there has been a change of heart and that the proposals rejected down the years can now be accepted,” he added.

But Sinn Féin housing spokesman Eoin O Broin whose party supports the Bill, said Labour had been in six separate governments since the Kenny report was published and "it would have been better if the Labour Party had sought to introduce this legislation when in government rather than just from the Opposition benches".

The Government wants the Bill delayed for 12 months. Minister of State Malcolm Noonan said this was to allow sufficient time for consideration of the Law Reform Commission's report, which is expected to include a draft Bill for compulsory purchase orders.

The Bill is also “premature” with regard to alternative Government proposals on land rezoning, work that was now “advanced”, he said.

But Labour's Sean Sherlock said that "dressing up" the deferral of the Bill based on a 48-year-old report and calling it premature "is not an honest argument to make ".