Sunday 25 August 2019

The right moves: Agreement is the best route to soothe CPO fears of homeowners

Paul McNeive
Paul McNeive

Paul McNeive

The announcement by the National Transport Authority (NTA) that it plans to compulsorily purchase (CPO) parts of the front gardens of 1,300 houses, on 16 routes in Dublin, for more bus corridors, throws up a raft of issues.

Not least of these will be a valuation conundrum over the reduction in value of the properties affected. Some serious issues arise, and there is also an opportunity for valuers and estate agents.

The NTA has published a map of the 16 routes, but details of which houses will be affected, and how badly, will not be available until the public consultation process starts in October.

No-one has said it, but if your house is on one of those routes, your house is now probably unsaleable until there is clarity about the plan, and whether or not it will go ahead- and that could take two or three years.

If the plan does proceed, calculating the compensation to be paid to house owners will be difficult and contentious.

The NTA has commented that they see the compensation per house, where they take part of a garden and a car parking space, running to tens of thousands of euro. But, that doesn't compensate you for loss of your amenity - and where are you going to park your car?

I suspect that the compensation payments are going to be much higher.

The first principle of the compulsory acquisition process is that the person losing property should be no "worse off" after the event.

The home-owner is also entitled to compensation for the subsequent loss in value of their house, because of the CPO, and it is under that heading that I see the payments ramping up.

For example, I can see the value of a house, say worth €750,000 now, but which loses part of its garden and car parking, and has a bus route close to the windows, being reduced by €200,000.

An option for the NTA is to buy the worst affected properties, by agreement, at the outset, and then re-sell them after the works have been done.

That will result in a smaller cost than compensating the existing owner - including for disturbance while the works take place.

More positively, in the long-term, houses close to the bus routes will see an increase in value, as commuting times reduce, but houses on side streets will do better than those directly on the bus corridors.

There will be an element of "getting used to it" but if the NTA handle this well, there is a real opportunity to bring the city together, with everyone benefiting from shorter commutes and less traffic.

The scheme has the potential to positively transform Dublin and will increase property values in the outer suburbs.

It's important that improved access to the suburbs doesn't result in another burst of "urban sprawl," and distract from the imperative of increasing densities in the city centre.

The big question is whether the NTA plan can survive the pressure of local politics, particularly with elections on the horizon. There is a lot of support for the proposals but the NTA will have to overcome people's fear of what they cannot see now. Some of the routes will not require compulsory acquisition affecting houses and it must be a good idea to build those routes first and let everyone see the benefits.

If an Englishman's home is his castle, there is no more dangerous adversary than an Irishman defending his land, and the NTA will be well advised to make the majority of acquisitions by agreement.

The issue is an opportunity for estate agents to generate business.

House owners on the routes will be worried about all of this, and will have lots of questions. One of the most successful initiatives I was involved in, when in practice, was the putting together of a "roadshow" when the CPO plans for the M50 motorway were announced.

This was a presentation on how the CPO process worked, in tandem with a presentation by an engineer on infrastructural issues in the local area, i.e. drainage and roads, and how they would be affected.

We ran the presentation in local hotels along the route of the motorway, and they were well attended.

It resulted in many instructions to handle CPO negotiations, but more importantly, led to several large land sales for farmers, whom we had met at our "roadshows." Agents should be doing the same thing now on the 16 bus routes.

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