Low rise investments
One sector of the Irish economy is booming. Recession notwithhstanding, there was a 76% increase in sales of new apartments in Ireland from 1980 to 1981. The bouyancy of the market meant that whereas £17 million worth of apartments had been sold in '80, exactly twice that figure's worth were sold in '81. Likeewise 1981 saw an increase in new apartment starts - in '80, 342 were started, in '81 787 was the figure.
Such is the current bouyancy of the market that demand for new apartments is expected to continue throughout '82 and '83. It has been forecasted that in excess of 1500 apartments will be sold in the next eighteen months. In this year alone, one in every six new dwellings being built in Dublin will be an apartment.
There is· little doubt that one of the influential factors in the bouyyancy of the apartment market is the incentive element which was provided by the 1981 Finance Act. Under Secction 23 of that Act, the owner of a new apartment is not liable to tax on rental income from the apartment, providing the apartment is less than 75 square metres (807 sq.ft.) and providing it is let for a ten year period. The Act further provides for a special 100% allowance of construction exxpenditure incurred between January of 1981 and March of 1984 in the proovision of certain types of rented resiidential accommodation.
Not only do the provisions of the '81 Finance Act allow for a tax allowwance on new property, but they also allow the purchaser of a new aparttment the same allowance on the renntal income from any other residential, commercial or retail property, new or old, until such time as the tax allowance is used up. Although houses under 125 square metres (l ,345 sq.ft.) also qualify for these tax concessions, they are unlikely to benefit as much as apartments since, generally speaking, new houses are not in such convenient locations. It is fairly obvious then that new apartments, viewed both as a tax incentive and as a means of capital appreciation, represent a lucrative innvestment.
The majority of the Irish apartment market is centred in Dublin. For exammple 98% of all new units built in Ireeland in 1981 were built in Dublin. This fact offers another explanation for the boom in the apartment market. Namely, with the population of Dubblin (including the City, County and Dun Laoghaire Borough) expected to increase by 166,000 in the next ten years, there is certain to be acute housing shortage in the Dublin area.
Apartments could provide part of the answer to housing problems since, by their nature, more of them can be built more quickly than individual houses. Housing surveys carried out by An Foras Forbartha in the sevennties showed an overbalance of very large houses which were out of line with people's actual needs. Compact 2 and 3 bedroomed houses represent the building priorities of the immeddiate future.
Likewise the design of the future in apartments will show a continuation of the trend whereby tall, bulky apartments have been superseded by smaller, more intimate 2 and 3 storied blocks. Since such low rise buildings do not require lifts there is a considerable saving in construction costs. Brick facings, slated or tiled roofs, high grade insulation standards and great attention to internal layout represent the sort of features which will sell apartments.
As the building trade responds to the need for new housing, it is imporrtant to remember that conservation lobbies do not always arise because of the intrinsic worth of preserving a particular building. Sometimes connservation lobbies are based more on fear of what might replace an old building, rather than on a love of the building itself. Sheelin Homes' Merrion Village and the Carraiglea, Queens Park, Monkstown development of Horan Cotter Associates are but two examples of apartment construction which draw their inspiration from the buildings of the past and yet make an attempt to maximise the advantages of their particular locations.
Prices for a typical new apartment, such as Packenham, The Slopes, Monkstown and Donnybrook Green, Donnybrook (Selling Agents Hooke and MacDonald) range from £45,000 to £60,000.