Little boxes… Is that the future of housing Kelly style?

Maoilíosa Reynolds  – architect specialising in apartment design

AS we are on the brink of the new ‘shoe box’ or bed-sit type flats of tomorrow – a housing minister’s plan to ease a national housing scandal – an architect specialising in apartment design discusses just why Alan Kelly’s plan will fail.

Maoilíosa says:

Alan Kelly’s new minimum size standards for apartments are the Government’s first step to reduce costs and improve supply and affordability in the face of a full-blown housing crisis – It should be welcomed, but it is unfortunately a fundamentally flawed effort.

In effect, the previous 2007 apartment size ‘guidelines’ have now become the new mandatory minimum standards.

These earlier guidelines established minimum apartment areas, room sizes, room widths, balcony sizes and appropriate internal storage for different types of apartments, and went some way to ensure that dwelling functions and internal planning were considered in detail and were, crucially, open to interpretation by local authorities.

In schemes of 100 units or more, a minimum of half of all units must exceed the minimum floor areas of 45sqm, 73sqm and 90sqm.

Most current planning applications are for less than 100 units so this won’t have much effect.

In any event, however, the prescribed minimum room sizes do not fit into the new 2015 standard minimum footprints.

The new regulations’ complex and vague wording will also result in differing applications and planning delays.

In addition, according to the new regulations, up to half of all new apartments in the country could be ‘studios’.

Many commentators have criticised the housing minister for re-introducing such small ‘shoebox’ apartments, one-room units of just 40 square metres, which is about two-thirds of the downstairs of a standards three-bed semi-detached house.

These units will be single-aspect small modern ‘bedsits’ and will reduce the average size and quality of apartment developments.

Despite nationalising these apartment size standards and forbidding local authorities from deviating from them, the impacts of these new 2015 minimum standards are not uniform across regions.

In an analysis of five different local authorities, two will see apartment construction costs increase and three will see these costs reduced due to the new standards.

The most significant change is Dublin City Council were site costs are high so the percentage impact is marginal.

The average cost reduction per apartment with the new size standards is a mere €6,700 per apartment. This is a negligible saving in the scheme of apartment construction costs overall.

Dublin City Council’s area also has the highest asking prices. If there is a market demand for docklands apartments selling at half a million euro, then supply will improve in this location. Reducing the size of an apartment in this location by 7sqm will reduce total costs by just 1.5%, but still sell for €500,000.

There are other, much more effective ways, of reducing the costs of building apartments that the Minister or his advisors should have considered.

For example, the so-called ‘Part V’ social and affordable housing provisions apply to multi-unit residential schemes over nine units, and add an estimated €10,000 per unit to costs.

They also rely on market activity, which as we know when the market in not being active, means a reduction in the supply of social housing just when it is needed most.

In March 2014 the Government introduced onerous and bureaucratic ‘reinforced’ self-certification procedures for inspecting buildings to ensure they were built to a high standards.

Known as BCAR, these regulations have added €27,100 to apartment costs for little consumer benefit.

In comparison, the equivalent UK cost for similar compliances is just €276 per apartment. This is something that should be tackled.

In response to a sixty per cent reduction in one-off housing commencements in the first twelve months after the introduction of this BCAR certification scheme, the minister granted an exemption for one-off houses and extensions in September 2015.

It was interesting that in response to this move some banks refused to provide mortgages for one-off houses that had opted out of the BCAR inspection scheme.

Shrinking dwelling size is the least effective method to reduce costs as some basic research could have demonstrated, but has the greatest impact on quality of life among other factors.

Simplifying the regulatory environment, reducing VAT, controlling lower site costs are all more effective ways to improve affordability and increase supply with no loss of dwelling quality.

Indeed, by reducing VAT to from 13.5 per cent to nine per cent (saving over €12,000 per unit), reform of BCAR, more realistic developer’s profit and control of site values, over €100,000 could be knocked off the cost of an apartment in Dublin, with no loss in quality or size.

The most serious impact of the new 2015 minimum size standards will be to the quality of the occupiers’ living environment.

The size of new homes here will now align more with the UK, acknowledged as the smallest in EU, and not a path we should follow.

Purchasers may end up paying the same price for smaller dwellings in outer-urban areas and less desirable locations.

There may be minor improvements in residential supply but only at upper market levels where projects make a profit and in desirable areas were site costs are high.

NAMA will be completing projects at unaffordable levels due to legacy pre-crisis site values.

For NAMA to build and sell apartments at current asking prices would mean crystallising significant losses, and as such, NAMA can not solve the affordable housing problem.

There is no ‘one-size-fits-all’ design solution that policy makers can apply to different sites in different locations as is implied in these new regulations.

The 2015 DECLG size standards will reduce apartment quality and create planning delays that will further inhibit supply in the short term and impoverish our built environment in the longer term.

The Government’s three aims of the new apartment size standards were to reduce costs, improve affordability and increase supply. The new standards fail on all three fronts.