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Fire Safety

Celtic Tiger apartments: Householders frustrated over lack of access to loans for defect repairs

One homeowner said he was turned away by five banks when he tried to take out a loan to help cover the €15,000 bill.

HOMEOWNERS IN CELTIC Tiger era apartment developments have called for better access to credit to help fund the works on their homes.

Tens of thousands of apartment units built during the Celtic Tiger era are estimated to be affected by construction defects, largely relating to fire safety deficiencies such as a lack of fire stopping between apartments, or water ingress causing leaks and damp.

Owners are being asked to pay bills of between €15,000 and €20,000 and some have complained they were given a short space of time to come up with large lump sums.

They are calling on the government to ensure easier access to loans so they can cover the lump sum and then pay it off over a number of years.

  • Our colleagues at Noteworthy want to investigate the building inspection regime across the country. Support this project here.

One homeowner, Kevin*, who spoke to The Journal said loan applications to help cover the €15,000 bill were refused by five different banks, including the bank that holds his mortgage.

He said he had missed a small number of mortgage payments several years ago, but has been fully up-to-date on his payments for a significant period of time.

Kevin said he has tried, without success, to come to an alternative payment arrangement with the management company.

“I had been hoping to pay the lump sums, but in my circumstances it’s just not possible,” he said.

“They’re asking for €5,000 in the first phase and then €10,000 in the second.”

He said the owner’s management company – essentially an entity that legally owns all common areas in developments – did back off a bit during Covid and that there wasn’t as much pressure, “but the number of letters from them have ramped up in recent weeks”.

Kevin said as a last resort he attempted to go through the arrears process at his bank so he could pay interest-only on his mortgage and use the money to pay for the repair bill but this request was denied. 

“I understand that the management company has a responsibility to ensure it’s all safe and we have a fire safety cert issued to get insurance, but my gripe is around the lack of understanding from financial institutions and there doesn’t seem to be any great urgency from government to address this.”

Another homeowner, Mark*, who owns an apartment at the Beacon South Quarter complex in Dublin, said he managed to get a loan through Ulster Bank, which holds his mortgage, around three years ago when he was required to pay for fire safety defect repairs. 

“It was at the time a fairly simple conversation because I told them if I didn’t pay this then it wouldn’t be fixed, I wouldn’t be able to rent it out and they’d be sitting on a toxic debt,” he said. 

As well as the fire safety deficiencies, his apartment building also has water ingress issues, which he said cause leaks as well as damp and mold issues in his apartment.

An insurance claim is pending but even the maximum insurance payout will likely only cover around half of the €20 million bill, he said. He expects to have to raise €20,000 to cover those repairs. 

He is concerned at what Ulster Bank’s move out of the market could mean for his access to credit for this new bill and about what it will mean to take on that additional level of debt. 

Mark is renting out the apartment to tenants and said the rent is enough to cover the mortgage payments but after tax he is still making a loss. 

He said the apartment, which he bought in 2008 hoping it would provide an extra pension fund on retirement, is now still in negative equity of over €100,000 and it would be difficult to sell in any case before these issues are fixed. 

“This was my longterm investment and it’s costing me an arm and a leg,” he said.” On top of the mortgage I’ll have invested another €130,000 in it between tax on the rent and the fire safety and water ingress repairs.”

Mark said one way the government could help would be to tweak tax rules to allow homeowners to write the costs off over a period of time.

He also said consideration should be given to allowing the owner’s management companies to take out a low-interest loan to allow for longer-term payback schedule for owners. 

“I’m not looking for this whole thing to be written off – though that would be nice – but it would be helpful to be able to spread it out in some way over a longer period of time.”

High interest rates

The Construction Defect Alliance, the campaign group for impacted homeowners, has around 30,000 affected properties on its database but estimates that as many as 120,000 properties may have one or more of these types of structural deficits.

Speaking to The Journal, spokesperson Pat Montague said homeowners generally have to take out personal loans because their banks will not give them a top-up on their mortgage to cover these costs.

“So you have to get a personal loan, say from a Credit Union or from your bank and that’s costly, the interest rates are higher,” he said.

You’re talking about three to five year terms, you’re paying interest rates of around 10%, so that’s a big ask. If you’re borrowing €18,000, you’re paying several thousands on top of that in interest, whatever way you look at that it’s an imposition. And people feel very strongly, they’re asking; ‘Why am I paying this? I’m not responsible, I didn’t cause this, I bought in good faith, I got my surveyor to comes in, there was a fire safety cert so why am I getting hit?’.

He said the campaign has put forward a number of options for solutions, including a grant scheme similar to those set up for homeowners impacted by mica or pyrite. Montague said the administrative work on such a scheme could be significantly reduced in this case if owner’s management companies applied for grants for the full cost amount, rather than asking each individual homeowner to go through the application process.

Another option, he said, would be to provide soft loans - a loan with no interest or a below-market rate of interest- either directly to homeowners or to owner’s management companies, which would then levy the property owners. He said this would only be acceptable to owners if they could recover 100% of the costs through the tax system.


There is “no effective legal route to get at the builder developers”, he said, because of the six-year statute of limitation and the way in which developers set up their companies. Montague said he was aware of only one case in which the original developer contributed to the costs. 

Montague said the government also needs to look at how to prevent this situation from happening again. Regulations have been strengthened to ensure that that a qualified professional signs off on works at several stages during construction – during the Celtic Tiger years this certification was only done once the building was complete. 

However he pointed out that these certifiers are still employed by the developers. 

“There could be a conflict of interest there at times, so we think that you still need the ‘big stick’ of the possibility of an external inspection in the way, for instance, that there’s a threat of an inspection by Revenue or the Food Safety Authority and that puts the fear of Jaysus into people,” he explained.

“That’s what you need to help change the culture – you’re not going to inspect every single development in the country but the possibility of an audit encourage compliance. 

“And then if a developer has a track record of non-compliance that’s taken into account when they apply for planning permission for their next development. At the moment it’s consequence-free for the builder developers, the people who built defectively are still building and there’s nothing to stop them.”

The Department of Housing has established an independent working group to examine fire safety and structural safety defects in apartments and duplexes built between 1991 and 2013. 

This group, which has been meeting monthly since March last year, will report back to the Minister for Housing Darragh O’Brien on the scale of the problem as well as the costs associated with repairs later this year.  

In response to a query from The Journal, Minister O’Brien’s department said the working group is consulting with a wide range of relevant stakeholders. 

“The insights gained through engagement with stakeholders as well as the outcome of the online consultation are informing the ongoing deliberations of the working group,” it said.

“Minister O’Brien is satisfied that the working group is working effectively and efficiently on this complex matter, and will require sufficient time to complete its work. He looks forward to a report later this year following completion of their consultations and deliberations. Once received, the minister will give full consideration to the report’s contents.”

*Homeowners did not wish to be named so we’ve used different first names here. Their identities are known to The Journal. 

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