The other arm and leg: the actual cost to the consumer of S.I 9?
Industry estimates for self-building in Ireland suggest that self-building comprises over 60% of all houses completed in the state. So for 2013 approximately 8,000 houses were completed, 4,800 were self-built. These are houses built by normal people, at their own speed, the biggest investment most will make in their own lives. The average standard we know of these is well in excess of the current minimum standards offered in the "built for sale" market.
Most self-builders do so out of financial necessity. Its a steep learning curve but with the appropriate professional input (engineers, architects etc) it can minimise surprises and shocks. It can be a difficult process but all who do it will say it is certainly a memorable experience! What will the cost be for a typical self-build now that normal citizens can no longer manage their own builds?
Under SI9 unregistered builders must now be used in all residential projects over 40SqM. If a self-builder elects to do this role they will be deemed not compliance and may not be able to re-finance or sell their house later on. How much extra will a self-builder have to pay now under this new regime? We have scouted some industry sources to find out.
Recent estimates from professional sources suggest the extra professional costs for SI9 would be in the region of €5000 for engineers, architects etc. (BRegs Blog Ref). This is only the professional fees!
On say a typical €180,000 house a contractor's "management fee" would vary from between 5- 10% of the construction cost. For every sub-contract he charges a 5% "attendance" fee to manage various sub-contractors. So conservative estimate of extra cost for having to use an unregistered contractor would be €18000. So total extra cost of €23,000 or 12/8%. A huge additional cost for a sector of ordinary people trying to build their own houses and get value for money. So if 5000 self-build houses would have been initiated this year the cost to this sector, to us, could be €115,000,000.
Key stakeholders and professions have called for postponement of this legislation stating that there will be no benefit to them, the consumer (Ref: Breg Blog).
€115,000,000 for no benefit. That is a lot of votes in the next local and general election Mr. Hogan. Politicians better take notice, this would be similar to the mistakes that the last government made and we all know what happened to them.