Re: Re: The Question of Land
The Irish love land and always put a high value on it . . .
I once heard a story about a developer I know. He was putting together a site to do a development. So one morning during the breakfast he invited a couple of his ‘hard hats’ into the nearby shop to get bread rolls. He told his colleagues, pick out what you want and I’ll pay for it. So they did. Then he said to the shop keeper, I will have these bread rolls and also, I want to buy your shop. That is what you call cutting to the chase. You have to admire the efficiency of it. By the way, the shop keeper never sold out, and the developer got interested in another project.
I think the Irish relationship with land is slightly perverse. Like the proud father holding onto his beautiful daughter too long. I guess we were so poverty stricken and beaten down in Ireland for so long, we are affected by it. The beautiful daughter is too good for any of the locals to possess. In this case, the daughter is land, and land cannot stand up and fight for itself. But it does have a way of biting us in the ass all the same.
I have listened to accounts of people in Leitrim who do not want their land to end up in their neighbours hands when they are gone. The ideal would be for an outsider to come in and buy it. But there is still a chance the neighbour might rent the use of the land from the outsider. The ideal solution for a Leitrim land owner, who is thinking in terms of the future, is for an outsider to buy their land and put it into forestry. Thereby ensuring for future generations that none of the neighbours will not get their paws on it. It was an old man from Leitrim who told me that, but it is probably a familiar pattern all over the country.
That is why I admired the man with buying the bread rolls.
. . . which is why only a single-digit percentage of the Irish land bank changes hands every year.
Can you see a problem with that?
Land is often subject to an increase in value because of infrastructural building that the landowner doesn’t contribute a farthing to. Someone who owns a house beside a LUAS line, benefits from a large increase to the value of the land on which their dwelling sits. But has to contribute nothing to the public good in return. That is on the individual dwelling scale. You can scale it from there, and achieve trully massive gains if you know what you are doing.
There is no incentive to sell on the land and make it available for better uses. This drives up the cost of everything abnormally in this country, and we all end up paying the price. In the paper the other day, I looked at a headline: The IMF says that Ireland needs to introduce a ‘Property’ tax.
No, no, no, no . . . . No o o o O !
If we tax the property we are missing the entire point.
The property only sits on the land. What we need to do is encourage the right kind of property, on the right kind of land. Introducing a ‘property’ tax will only prevent us achieving that. If you tear down the roof on something, it is no longer considered property and becomes derelict potential building land. Introducing a taxation on the land on which the property sits is what is really required, to re-distribute the correct building functions to the correct land locations. But trust the IMF to get it totally cock-eyed there.
Bull, Balchin and Kieve’s book on Urban Land Economics make a similar point about retail space in the UK. The UK is over supplied with retail space. But it is the wrong kind in the wrong place. Paul Keogh made this point in relation to residential here:
This is one of the first and most important corner stones of sustainable land development. Which I tried to develop a simple and use-able model for here:
The property developers are very busy people, even today. Not many people imagine that, but they are. They certainly need a good robust model for assessing the sustainability dimensions of future development. To date, that hasn’t really been forthcoming from any quarter that I know of. Planners normally want to get developers messing around with reed beds and rubbish like that. But cannot see the bigger picture.
That is why Irish agricultural land prices in early 2008 averaged Â£15,357 compared to Â£4,316 an acre in the UK.
That is an interesting statistic. I didn’t know that.
Consider those values in the context of population size & wealth stats and the difference is even more outlandish.
I read recently in the Energy Saving Trust UK publication on light bulbs and energy efficiency, that about 800,000 homes in the UK per year undergo extensive electrical re-wiring every year. (I think that was based on a 40 year cycle for electric re-wiring of houses) Now imagine that. That puts some kind of measure on the scale of the market in the UK compared with Ireland. Ireland has a total housing stock (including all the newly built apartments) of around 1.4 million units. So, you can imagine the dwelling retrofit industry in the UK would go through the entire building stock in Ireland every two years.
Brian O’ Hanlon