City Council ‘does not outbid’ private buyers in housing market

Charities that buy houses in Galway for homeless people are not distorting the property market, a senior official at City Hall has said.

Dermot Mahon, Acting Director of Services for Housing at Galway City Council, insisted that Approved Housing Bodies (AHB), which provide and manage rented social houses, do not outbid private buyers in the housing market.

He was responding to queries from elected members before they approved a loan of almost €1 million to facilitate three AHBs to buy four city homes.

“We don’t engage in a bidding process,” Mr Mahon said. “We take a value, and we will not exceed that value. If there are other purchasers we will not engage, and we will not exceed it [valuation].”

He said that there is a cap in all local authority areas set by Government regarding the maximum amount that can be paid to purchase houses for use as social housing rental properties.

Councillors agreed to approve loans of €930,000 for the purchase of four homes.

The agreement included €202,355 to Galway Simon for a two-bed house off the Western Distributor Road in Knocknacarra; some €189,264 to Cope Galway for a one-bed apartment on Dominick Street; and €246,528 and €292,279 respectively to Peter McVerry Trust for two-bed and four-bed houses in Doughiska.

Funding is provided by way of a grant from the Department of the Housing to the local authority who provides the funding to the relevant AHB in the form of a 30-year mortgage. Loan charges are waived provided the terms of the scheme are complied with.

“All properties have been supported by an independent valuation and represent good value for money,” said Mr Mahon.

He said that Simon and Cope were two organisations that had “excellent records” in Galway.

Mr Mahon said that Peter McVerry Trust is “in the market for more property” in Galway.

The Trust already operates the Modular Family Hub in Westside on behalf of the Council, which is a temporary facility to house people who are homeless in accommodation other than hotels and B&Bs.

Two families from the Westside Hub will be relocated to the two new properties bought in Doughiska.

In response to several questions from councillors, Mr Mahon insisted that the method of allocating housing was “transparent”.

“There is no queue skipping – it is done in consultation with us,” he said. It is based on need and length of time on the housing waiting list.

Cllr Alan Cheevers (FF) called on the Council to carry-out full surveys of houses before they are allocated to tenants.

He pointed to a recent situation in Doughiska where homes were allocated to tenants but the properties were ‘faulty from the get-go’, which was not acceptable. The issue was decided on in the courts, he said.

Mr Mahon said the four new properties being discussed were compliant with planning permission and had been assessed by engineers.