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State facing €2.8bn bill to fix apartments with construction defects

/ 15th July 2022 /
BP Reporter

It could cost the state up to €2.8bn to fix apartments with construction defects built during the Celtic Tiger era, according to some estimates.

Up to 80% of apartments built between 1991 and 2013 may be affected by construction defects which in some cases pose fire safety concerns.

The Construction Defects Alliance (CDA), a group which has come together to represent the interests of the owners of affected apartments, has said that 92,000 apartments could be affected, based on work carried out by one of the largest management companies.

Tánaiste and Fine Gael leader Leo Varadkar told the Dáil yesterday that he has heard of people having to pay out €60,000 to fix their homes.

Labour Party leader Ivana Bacik said that the government must make a greater effort to chase those responsible for the defective properties and ask them to contribute to the bill.

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The Dublin Bay South TD told the Dáil: "We understand the working group on defective homes will be completing its report next week.

"We also understand it will have found that up to 100,000 apartments have been affected by fire safety and other defects, with up to 44,000 apartments in the process of being remediated right now.

"There is the fear of debt due to the cost of fixing the defects, but also a fundamental fear about safety in their homes, primarily due to fear of fire because these homes were defectively built."

Bacik called on the Tánaiste to commit to introducing measures in the budget to help these people.

Apartments
Leo Varadkar has signalled that the state may have to help out owners of defective apartments. (Pic: Sam Boal/RollingNews.ie)

Mr Varadkar said that the government has put schemes in place to assist homeowners affected by mica or pyrite and that a similar response will be needed to assist those with fire defects or other issues in their apartments.

"I believe we will need a response to assist people who are facing large bills as a result of defects in apartments," he said.

He added that a working group was established on this issue and that its findings will be published by Housing Minister Darragh O'Brien by the end of the month.

"The basic principle applies that there will have to be government assistance for people who, through no fault of their own, purchased apartments that are in buildings where there are defects and those defects have to be repaired," he said.

The total cost of remediating the apartments could be €2.8bn, with the average cost per apartment is expected to be €27,500.

It is also understood that three different subventions will be suggested by the working group. This includes the state paying for the works, providing grants to management companies to cover part or all of the cost of the works, or providing low-interest loans for management companies.

In the case of loans, the cost could ultimately be passed on to apartment owners.

Ms Bacik described the Tánaiste's comments on the matter as "positive and encouraging".

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