When Fingal County Council took the landmark decision of setting strong sustainable building requirements into the Cappagh Local Area Plan in October of last year, the arguments for and against such a progressive initiative started rattling around in my brain. In the process of writing about the story as it has continued to unfold, I have discussed the minutiae of the policy Fingal introduced with an exhaustively diverse group of people who could bring their experience to the various implications that arose from setting such a standard.
Coming up with a robust understanding of the various issues has involved speaking with everyone from developers with land in areas where these standards have been introduced, to economists, to planners, to architects, engineers & product suppliers with experience and know-how of how to fulfil requirements of this nature. Although the social, environmental and long term cost benefits of this approach are easy enough to understand, the key issue in most people's minds is expense. Would it cost too much and discourage developers from building, or force property prices even higher?
The natural assumption to make is that demanding considerably better energy performance standards would send construction costs vertical, and that developers, being bottom-line oriented, would balk at the idea of any extra outlay. The other fear is that if developers have to spend extra, they'll pass on that extra cost, and a little extra for their trouble, to the long-suffering house buyer. There is also an assumption that many developers will only do the very least they can get away with, to keep profits as high as possible. But is this true?
The way the situation has evolved in Ireland during the property boom over the last decade or so, there surely is at least a grain of truth in that. However, there are a number of factors that have caused this, to my mind, and they are destined to change. To state the very obvious, the Irish property market has been a seller’s market for some time. Irish people have looked at what has happened to house prices during this meteoric rise, and assumed that the graph will keep on rising. This creates panic, and people buy property before prices rise more.
Every once in a while, some think-tank or other pops up in the media and warns of a property market slowdown or—worse still—crash, drawing comparisons between trends in Ireland and other markets that suddenly lost their buoyancy. To deal with any wobbles in consumer-confidence, a government figure might say “if you’d listened to them a few years ago look how much you would have lost out on!”, or alternatively a bank economist might announce further dramatic increases in property prices and reassure people that there’s still plenty of room for growth, all the while cranking up the percentages of mortgages they’re prepared to offer, till they’re eventually lending the whole house price and paying the mortgage holder a deposit! All of which means that homebuyers, who believe what they’ve been told, buy houses, pushing prices up further again.
In this seller’s market, people don’t tend to ask the questions they should. They may prefer a more sustainable home if given the option, but in a seller’s market they haven’t had that luxury. The onus has been on getting your hands on a property no matter how badly built it may be, and then trying to move up the property ladder. Conversely, the self-build market, where the homebuyer is the specifier, offers some insight into what people want from a home, as they have the power to choose. It’s common knowledge in the sustainable building industry that the self-build market has been key to the growth of the sector.
Similarly revealing is the response to the Greener Homes Scheme, which offers grant funding for the domestic installation of renewable energy technologies. The scheme was announced on 26 March this year, and by 26 June, Sustainable Energy Ireland (SEI) had approved 4,000 grant applications—well above what they had anticipated.
A couple of years ago, before energy prices started to rise, and before mandatory energy ratings for buildings were looming on the horizon, there was no real incentive for developers to build sustainably. Why would they? They could sell poorly built houses that just scraped through theoretical compliance with the thermal performance requirements of the Building Regulations—and almost certainly did not actually comply due to poor workmanship on site. I’ve spoken to developers who say they would not spend above the bare minimum on construction costs purely because if they intended to spend more to achieve better performance, another developer could outbid them on the land, and cut corners when it came to building the development. Therefore this encourages land prices to rise, forcing developers to drop construction standards to stay competitive. This is very much a symptom of a market where the only regulation is to demonstrate—even just on paper—minimum compliance with poor building standards.
Continue to Page 2
