IHBA tackling Housing Sector challenges head on
IHBA Chairman outlines his priorities
The Irish Home Builders Association’s (IHBA) newly appointed Chairman ANTHONY NEVILLE outlines his priorities after taking office to CAROL TALLON and reaffirms the Association’s commitment to support house builders in navigating through industry changes.
Anthony Neville is not a chairman removed from his members, he is a provincial house builder who happens to build in the Dublin market and, as such, he has on-the-ground insights into the working challenges of both.
“The two-tier economy is nowhere as pronounced as it is in house building. There are two completely different housing markets. There’s the Dublin market and then there’s provincial Ireland. Provincial Ireland is dead. There are isolated pockets here and there, where people are building, but they’re building at very marginal rates,” Anthony says. “Our Dublin members have a different set of problems to our members in provincial Ireland. That’s not to say that the problems in the Dublin market are not real, of course they are, they are just different to the provincial problems.”
When discussing the changes within the industry, Anthony describes a more labour-intensive process and that’s without even setting foot on a building site. “It’s a simple enough thing to build a house, but it’s a complex industry with all the components in it. We have to source land, then go through planning. We have to deal with local authorities, we have Building Control regulations, or BC(A)Rs, compliance matters, the performance of suppliers, materials, and then the heavy administration and form filling.” He cites one particular Dublin member firm that has seen overheads climbing from 11% to 15% as a direct result of more onerous compliance procedures and an increased level of interactions with their bank.
Priorities of office
Given the challenges faced by his members and prevailing uncertainty, Anthony Neville is unequivocal about his priorities as he takes up the role of Chairman. He is resolute on the need for greater engagement between his organisation and its members. He understands the power of collaborative solutions to commonly-shared problems and he sees the potential for the industry in talking to – and being listened to by – policy influencers.
“One of my main goals is to get IHBA members to engage or re-engage with us. We’ve come through a traumatic time, while a lot of our members are finished in business, quite a number of them are still around. But they haven’t been at the coal face of building or maybe they haven’t been to local CIF meetings, simply because the last few years have been all about survival. Membership and their need to attend meetings went way down the importance scale,” reasons Anthony. “However, the difficult reality is that builders who have been inactive for a number of years cannot fully understand the extent of change across the industry over the past three or four years.”
There have been huge changes in the financial and reporting side of the building industry, according to Anthony. “Builders who have been out of action for a few years are in for a tough awakening the first day they try to draw down bank finance,“ he says.
Other challenges come under the guise of changing building specifications and new building regulations. “There was a time when new regulations would be phased in but now the Department axe comes down and the new regulation is in from that date.”
When discussing some of the most commonly shared problems among house builders at the moment, top of the list is the issue of developments bonds, followed closely by regulatory challenges and negotiating Part 5 deals with local authorities.
“There is a common set of issues that are being dealt with on an ad-hoc or piecemeal basis but we need to collaborate and to find a uniform way to deal with these,” Anthony explains. On the contentious issue of development bonds, he is aware of “people are going in and doing deals with the local authorities – many times too low – and setting parameters for the rest of the local industry that might not be the best. There are costs provided for in the Act, including margins; however, members going in unprepared and unsupported, are sometimes accepting less. If more of our members engaged with us, they could tap into this working information.”
Interaction with policy makers
The IHBA works closely with the Department of Housing, Planning, Community and Local Government on behalf of members and Anthony is satisfied that the Department is keenly aware of the need to reduce costs for the industry.
“I see the level of interaction that the Department wants to have with IHBA. We didn’t have that interaction for a long time, but we have it now. We’re meeting with policy influencers, which we mightn’t have gotten near before.”
A practical example of this is the work currently underway to facilitate a workable development bond that is achievable in the market place, that meets the developers’ requirements, and, most importantly, one that meets all local authorities’ requirements in terms of planning compliance and adequate security until the development is completed.
The IHBA has shown a clear willingness to ask difficult questions of policy-makers and to tackle industry challenges head-on, more importantly, they are on-hand to help builders prepare for a return to the market.
This is an extended version of an interview first published in July/August 17 issue of Construction magazine.