Committee Reports > List of Committees > Joint > 1985 > Committee on Building Land > Report - Building Land

Appendix 5

Price Trends for Building Land

A5.1 The information available for this appendix refers to housing land and to developments in the Dublin area. The period discussed covers the early seventies to 1984. Information on the early seventies is drawn from the Kenny Report and submissions made to that Committee. From 1974 onwards, the information is based on a study undertaken at this Committee’s request by An Foras Forbartha of data provided by the Valuation Office. The results of the original An Foras Forbartha study were published by AFF in 1981¹⁴ and have since been updated.

The Early Seventies

A5.2 The Kenny Report states that “In recent years, there has been a remarkable increase in the prices paid for serviced land suitable for building & serviced land meaning undeveloped land which has the main services (water, sewerage, drainage) close to it”. The report also states that “figures … prepared by the Valuation Office… show that the average price per acre of serviced land was … £7,000 in 1971”. This would indicate a price of £700 to £900 for an undeveloped house site (depending on the density of private estate housing). A submission to the Kenny Committee which quotes the same average price for an acre of serviced land also quotes £1,800 to £2,000 as the average cost of a developed site in the Dublin area. This would suggest that the basic land cost varied between one-third and one-half of the final developed site cost, an estimate broadly in line with Table 4.1 in Chapter 4 of this report.

A5.3 The Kenny report also states that between 1963 and 1971, the price of serviced land in County Dublin increased by 530 per cent. It does not say when the bulk of this increase occurred though in a reference to the UK, it is noted that the increase in prices between 1969 and 1971 was greater than the increase between 1965 and 1969. It is likely that the rate of increase in prices also accellerated sharply in Ireland in the early seventies.

A5.4 The increase in land prices in Dublin continued until about 1973 but then prices appear to have declined sharply.

The Period 1974 to 1983

A5.5 Developments in the period 1974 to 1983 are shown in Table A5.1. The overall increase in price per undeveloped house site in Dublin in the

TABLE A5.1

Housing Land Prices in Dublin, 1974-1983

period was 600 per cent. However, 1974 is a poor base year since it was a period of depressed land prices and it appears that prices fell by almost half between 1971 and 1974. Taking an average figure for 1971 at £800 gives an overall increase in housing land prices between 1971 and 1983 of just under 350 per cent.

A5.6 It can be seen that the rate of increase in prices is very sensitive to the base and end years chosen. This demonstrates the variability of land prices and underlines the dangers of conclusions based only on particular time periods.

A5.7 The AFF study on which Table A5.1 is based found that the land market can undergo quite dramatic changes which are vital to understanding the behaviour of prices, particularly for housing land. The most important changes which occurred were in the size of parcels transacted and in their location. From 1974 to 1976, the typical parcel transacted was larger than ten acres. In 1977, however, parcel size fell to 5 acres. Since 1978, the trend has been towards larger sized parcels, though they are still generally smaller than in the earlier years.

A5.8 The Study sub-divided the Dublin area into three main sectors to examine the location of transactions. Here again, major changes occurred. In 1974 and 1975, the bulk of transactions were in the new town areas, i.e. in Tallaght, Blanchardstown, etc., and in the Northern part of County Dublin. From 1976 to 1978, however, half or more were in the South suburbs and 1977 was particularly notable with almost 80 per cent in that area. The years 1979 and 1980 show a reversal of the trend which occurred in the middle years and since then most transactions are on the periphery of the urban area or in the New Town areas.

A5.9 A final notable feature combined the trend towards smaller sized parcels and the changes in location. These were identified as infill development, comprising parcels of ten acres or less in the mature suburban or inner city areas. It included the type of transaction frequently associated with construction of town houses or similar expensive residential development. The year 1977 was unusual in that 40 per cent of transactions in that year were of the infill type. Almost all of the infill transactions were in the South suburbs.

A5.10 The AFF study emphasised the high degree of variation in land prices and this is evident in the Table in the relative prices in different locations. It underlines the necessity of treating any “typical” measures of prices with caution.

¹⁴ Land Transactions and Prices in the Dublin Area, 1974-1978. An Foras Forbartha, 1981.