Business Property & Mortgages

Wednesday 17 September 2014

Councils refuse to take over two-thirds of new estates

Published 09/11/2009 | 05:00

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LOCAL councils refused official requests to take over the running of 746 new housing estates last year because they were not finished properly.

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New figures show that just one in three housing estates was taken in charge by city and county councils, leaving more than 40,000 homeowners facing the prospect of living in unfinished estates.

This is because the planning authority said that roads, footpaths, lighting and other services were not in place and estates were not completed.

But councils have also admitted that many do not have the money to maintain the estates.

The admission comes as the Irish Home Builders Association (IHBA), which represents 1,500 companies, said that work on completing many schemes was not proceeding and that unless banks started lending, the situation would remain the same for the foreseeable future.

New figures show that last year, developers or residents asked local authorities to take over the running of 1,062 housing estates but just 316 requests were granted, totalling 19,296 homes.

But in 746 cases, the local authorities said the estates were not finished in line with the planning permission, meaning they would not take them over. This could affect more than 40,000 residents.

In some cases, the local authority has issued directions to builders to complete the estates, while some developments are waiting to be snagged to make sure they are up to standard.



Enforcement

In 70 cases, enforcement action is being taken or the local authority is using a bond paid by the developer to complete the works.

But last night the Local Government Management Services Board, which represents local authorities, said that in some cases there was "insufficient bonds" in place.

"The potential scale of the financial challenge facing local authorities is evident," it said.

"This situation has been exacerbated by the fact that several developers have gone out of business, which means that local authorities might not be able to follow the enforcement route to get work carried out. In some cases, too, there are insufficient bonds in place."

The Construction Industry Federation said builders were unfairly portrayed as not finishing estates, when often the reason they were not being taken in charge was due to delays by the local council. "There's huge difficulties in getting local authorities to take estates in charge," a spokesman said.

"Where you have estates that aren't up to standard, there are numerous options for the local authority -- enforcement proceedings or taking the bond."

But the Department of the Environment said bonds were designed as an insurance policy to ensure works were completed, and should have been sufficient to meet demands.

"That's the whole purpose of the bond," a spokesman said. "It was never designed to finish houses, but the ancillary services like roads, public lighting and common areas. If a developer has paid a substantial bond it's not in his interests to walk away. We have always emphasised that the bond is an insurance policy."

Irish Independent

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