Nama Report: Developers ‘hoarding’ home sites

Developers “hoarding” land are delaying building badly needed houses to benefit from rapidly rising house prices, the chief executive of Nama has said.

Nama Report: Developers ‘hoarding’ home sites

Brendan McDonagh said that only a small fraction of the residential sites Nama has sold to developers since 2010 for housing have actually been built on.

Mr McDonagh was speaking to reporters alongside outgoing Finance Minister Michael Noonan and Nama chairman Frank Daly at the presentation of Nama’s 2016 annual report.

Mr McDonagh said the agency had monitored the sites it sold for housing development after claims there was not enough residential land available to build on.

The sites could support 50,000 housing units, but only 3,200 units, or 6% of the total, had been built on or were in the process of being built.

“A lot of people ask what is the reason for that. There is clearly some infrastructural issues,” he said, adding that, with house price rising strongly, site values are soaring.

“By hoarding land, you actually pick up the increase in value without actually doing very much to it. So effectively, that’s a huge issue in my book,” Mr McDonagh said.

The benefits to developers waiting to start building were clear.

“The maths are very simple,” he said.

Asked whether developers hoarding land should be “named and shamed”, Mr McDonagh said he wanted to establish the reasons sites were not being developed for the country’s growing population.

Mr Noonan, who is preparing to step down in the coming weeks, said that legislation to stop developers hoarding land had to be delayed on legal advice but that the measure could be introduced after owners had been given an adequate notice period. He said the aim of the vacant site levy would “from a practical point of view” encourage people not to hold onto development land.

The Oireachtas had approved a vacant site levy but under legal advice, its implementation has been delayed.

Separately, Mr McDonagh said Nama will focus on its major work on Dublin’s Poolbeg Strategic Development Zone (SDZ) when Dublin City Council has approved the status of the SDZ. The lands could support thousands of homes at one of the best sites in Europe “given its location and closeness” to Dublin and its economies of scale.

More in this section

IE_180_logo
Price info

Subscribe to unlock unlimited digital access.
Cancel anytime.

Terms and conditions apply

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo
IE-logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day. PS ... We would love to hear your feedback on the section right HERE.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up