Would-be home owners priced out of the open market have already started applying for affordable houses under a scheme that has yet to receive planning permission in Cork city.
Hugh Brennan, CEO of Ó Cualann CoHousing Alliance, said even though they have not yet advertised the scheme, applications are coming in relation to 17 homes they are hoping to build in Knocknaheeny in an area earmarked for regeneration.
The proposal has the financial backing of a well-known charitable trust in Cork which declined to be named.
The Knocknaheeny scheme will include 11 houses and six apartments, including nine three-bed homes, one two-bed and one four-bed, as well as six apartments in a three storey building. A decision from planners is due by the end of February.
The houses will be owner-occupied while the apartments, which are close to tech giant Apple, will be rentals.
Mr Brennan said those eligible to apply include existing council tenants already living in the area who would like to surrender their house and buy an Ó Cualann home.
Earlier this month, Mr Brennan gave a presentation to members of the executive and two elected representatives of Cork City Council outliningbenefits of the Ó Cualann housing model, under which the maximum outlay on rental or mortgage is one third of net income.
Mr Brennan said the presentation was “well received” and that they are hoping further sites will be made available to them in Cork in the future..
Ó Cualann (Irish for Sugar Loaf, close to Mr Brennan’s Wicklow home) has two schemes in Ballymun in Dublin. The 49 homes that constitute the first phase are occupied and Mr Brennan said 10 in the second scheme of 49 should be occupied by the end of the month, and the remainder by the end of the year.
Mr Brennan who was previously involved with the Niall Mellon volunteer building charity in South Africa and with the Haiti-based Haven Partnership founded by former Independent News and Media chairman Leslie Buckley, said ideally they would like to build 5,000 homes over a five year period.
He said with Niall Mellon, they had built 6,000 homes over six years in South Africa, while in Ireland, it had taken six years to build 100 homes (Ó Cualann was set up in 2013).
Would-be buyers are queuing up for the second stage Ballymun homes, with 1,500 on the waiting list. Those who bought from the first phase — built under a fixed price, no variation contract — were able to purchase a three-bed for €177,000.
The same house will cost €219,000 in the second phase, due to construction inflation. Mr Brennan said new three-bed homes in Ballymun typically sold for c€360,000.
Those who buy in become members of the Ó Cualann co-operative. Their 10% deposits help fund construction. Private investors who provide funding get up to a 4% return pa for a period of either 18 months or three years.
The affordability of the homes is made possible by land provided at a substantial discount by local authorities and no development levies.
The Ó Cualann model operates in a way that prevents members exploiting their position by early sale of their homes. If they sell within the first 10 years, more than 50% of the profit goes back to the local authority.
“They would also no longer qualify as a first-time buyer and would need a deposit of 20% of the price of a home on the open mark, so it’s not in their interest to sell”, Mr Brennan said.