Dublin house sold through affordable housing scheme for €170k four years ago - now on private market for €250k
Local politicians are calling for clarity around the resale of homes bought through affordable housing schemes after a Ballymun three-bed sold by Dublin City Council for €170,000 in 2017 is now on the private market for €250,000.
The house, which was built by housing co-operative Ó Cualann Cohousing Alliance and sold under an affordable housing scheme four years ago, is now on the private market for almost 50pc above its initial sale price.
Ó Cualann Cohousing Alliance, which built the 49-house estate, has previously called for a mechanism to be put in place that ensures the houses can only be sold back to them or Dublin City Council to ensure they are kept in the affordable housing pool.
Social Democrats Councillor for Ballymun Mary Callaghan said there must be clarity provided around the process when people want to move or sell a property purchased through an affordable housing scheme.
“At the moment that doesn’t seem to be in place and that’s very important that affordable housing is seen to be fair and equitable, and not something people can profit from,” said Cllr Callaghan.
Local Fianna Fáil Councillor Keith Connolly has said that a mechanism will likely be put in place by the Housing Minister Darragh O’Brien to ensure the houses sold under the Affordable Housing Bill in future will remain within the scheme and aren’t sold in the private market.
He said there’s “probably a better model” than houses sold under an affordable housing scheme entering the private market and assumed “this will come to fruition over time”.
“There is a better way of doing things and hopefully that will happen with the passing of time. There will be more of these schemes coming into play. I know Ó Cualann will be building three, if not four, more such developments in Dublin North West.
“I’m hoping there will be a better model in play whereby it can only be sold back to the co-op or the DCC, which I’m in favour of,” Cllr Connolly said.
Hugh Brennan, CEO of Ó Cualann, has said the seller will have to pay a ‘clawback’ to Dublin City Council but said this is not “the preferred method of doing it”. He said he expects the house to sell for more than €250,000 due to the “publicity” around it.
“We would much rather that if someone does sell, that they have to sell back to the co-op rather than sell on. There is a clawback in place… the value agreed per plot is €30,000… the equation means that the seller will have to pay us €45,000 and we give that to Dublin City Council.
“I wouldn’t call it a nice little earner as they won’t be first time buyers, the deposit they will have to put down is 20pc, they will have to enter the open market. The prices that houses are going for in the open market at the moment are significantly more than the €30,000 would allow them to aspire to. It is still a disincentive,” Mr Brennan said on Newstalk Radio.
Mr Brennan said the asking price is still affordable and were it to be sold back to Ó Cualann, they would not be “selling it for much less than €250,000”.
A Department of Housing spokesperson said that under the Affordable Housing Bill enacted last month, an “equity charge” remains in place as a percentage of the value of the home for the entire period of ownership.
The spokesperson said: "If not previously paid by the homeowner, this equity charge must be redeemed as soon as when the home is sold or inherited. This will apply to affordable homes made available for purchase on local authority land, and to homes on private land bought with the assistance of the shared equity scheme. The clawback received will then be used to support the delivery of other affordable homes.
“As the prices of homes can rise as well as fall, this equity charge, which replaces the clawback, means that the State shares the benefit and the risk in relation to the market value of the home at the time of resale.”