Turbulence in the housing market as the mica crisis worsens
MICA is casting a “huge shadow” over Donegal’s housing market according to local estate agents.
Sellers say they are seeing a number of new trends developing due to the volume of ruined homes. These range from an increase in demand for older homes, those built before the Mica Age, to people willing to pay huge sums for properties confirmed to be free of the evil element.
“House prices have been going up lately, but Donegal is in serious pain because of the whole mica problem,” said Joe Reynolds of Letterkenny Property Partners.
“It’s having an extremely negative impact on the market because you have houses in Letterkenny, Milford, Ramelton diagnosed with mica, it’s not just Inishowen. And when you have a property diagnosed, it makes the proposition very difficult to sell.
Mr Reynolds said it was difficult to say whether people outside the county were generally put off by the dangers of buying a house with mica. He said buyers always came, but they were often interested in older properties, dating from the 1990s and earlier.
The lack of housing is a more important deterrent.
“The supply is not there. The ideal scenario would be for more new properties to come onto the market, because with the new regulations you wouldn’t expect them to have mica.
“But there are very few developers in the Letterkenny building, perhaps because we don’t have enough zoned land for private residential homes.”
Gerry Grennan of Premier Properties said mica is the first question asked when someone requests a visit. His advice to buyers was to have a structural study done before parting with any money.
According to Mica Action Group spokesperson Michael Doherty, those who buy or sell a home can perform a Suite A test that will examine the resistance of the blocks, but it will cost between € 1,800 and € 2,000, and if the results are not not classified, additional testing may be required.
Mr. Grennan added, “The first question a buyer will ask is whether the property is sound or when was it built.
“At a minimum, we advise all buyers to do at least one structural study so that they have something to fall back on. Surveyors can then recommend further testing or they will be happy to recommend the property.
“Without a doubt, the whole mica issue casts a huge shadow over the entire market.”
Sinead McCahey of DNG Boyce Gallagher in Letterkenny said the mica situation made it difficult for first-time buyers to access the real estate ladder because “prices are skyrocketing” on homes without mica.
“Right now there is a shortage of houses on the market and if something becomes available and there is no mica, the prices go up very quickly.
“We recently sold a three bedroom semi-detached house in an estate for € 185,000. But he needs about € 20,000 more spent.
“There is a real lack of new stock and no new development is planned. So if new or old homes hit the market there is huge interest because people are so hesitant to avoid homes that might have mica.
Another problem affecting the real estate market is the increase in the price of building materials. According to industry experts, contractors are delaying the start of new construction due to rising procurement costs.
“There really isn’t much available for first-time buyers,” said McCahey.
Donegal has, however, benefited from the move to work from home. Where previously people worked in cities, many now realize that it is possible to operate remotely while enjoying a different pace of life.
“We sold quite a few properties to people leaving cities during the pandemic. There were also buyers who came back from England and further abroad, ”Ms. McCahey revealed.