The residents of an entire estate are trying to sell their homes collectively, hoping to treble their home's value, writes Ronan McGreevy
It's a dilemma faced by any home- owner with a small house and a growing family. Two years ago Phelim O'Doherty realised that his corner house in Phoenix Gardens, Castleknock, was no longer big enough to accommodate his needs.
Like all the other homes in Phoenix Gardens, his is in a picture-perfect location - a secluded cul-de-sac with a well-manicured, triangular-shaped green out front, within a short distance of the Navan Road.
The four-bedroom homes themselves, though, are typical of many built in the early 1980s in west Dublin and, at only 100sq m (1,100sq ft) in size, are quite pokey inside.
O'Doherty priced an extension and found the costs to be "horrendous", leaving him in a quandary. Should he sell up, with all the attendant costs and uncertainties, or stay and put up with the cramped conditions? A meeting through his father-in-law with a developer soon offered a way out.
Like thousands of homes in Dublin built when land was not at a premium, the houses in Phoenix Gardens are small, but have relatively big gardens. The footprint is worth more than the house itself, so why not sell all 16 houses together? Each resident now has a €2 million offer on the table, nearly three times the market value, with a caretaker arrangement that they can stay in their homes until they find somewhere else to live. In a stagnant market and with a hugely expanded housing stock in west Dublin, the houses would fetch no more than €750,000 at current prices, though some with extensions would go for a bit more.
It is a tempting proposition for all involved, especially at a time when rising interest rates have brought the spectre of negative equity closer for homeowners everywhere. However, as the man behind the proposal has found, things aren't that simple.
An initial offer of around €1.6 million was rejected. Though it's more than twice the market value of their homes, residents were not impressed. For a start, they would incur 20 per cent capital gains tax because of the nature of the collective sale, and would also have to pay out at least €70,000 in stamp duty to find an equivalent home elsewhere.
The offer has since been upped to €2 million, a figure O'Doherty believes is not as extravagant as it might seem on paper.
"You get the mathematics and you claim on the basis of three to one. Then you have to take a person out of that house and let them buy something commensurate with what they have got," he says. "Put them anywhere else in Castleknock and you have got significant traffic on all the avenues, you have got to drive the kids to school where they can currently walk to school.
"You look at people who are trying to replace what they have got in Castleknock. It would not be hard to spend €2 million."
Nevertheless, he now has 14 agreements in principle, but the money may not be enough to persuade the two households still holding out against the move.
"For them it's not a greed thing, it's a life-cycle thing. It's a beautiful setting, it's very hard to replicate - to replicate that it would be more like €3.5 million in Castleknock. It's going to be very hard to get value for everyone."
O'Doherty has refused to say who the developer is, except to say that he has experience locally "of a very high-value development" on the Phoenix Park racecourse, where 2,500 new dwellings have been built recently.
The developer has done the maths on the proposal, which requires at least 70 high-end apartments selling at €1 million each to become viable.
"If I mention his name, that guy's going to get 100 calls and he's going to have people protesting outside his place with placards. It's volatile enough. I'm not in fear of my life and I don't expect to get a brick through my window, but some of the parties have become quite hostile," says O'Doherty.
Residents in Phoenix Gardens approached by The Irish Timeswere circumspect, referring all inquiries to O'Doherty. One says: "The spokesman on the whole issue as far as I'm concerned is Mr O'Doherty. He has the best pulse on the issue. I wouldn't be prepared to make any other comment other than what he has said."
The project is the talk of the area. Locals have the usual concerns that come with large developments, mostly concerning traffic levels and the effect on the character of the area - a selling point which attracted most of them to live there in the first place.
Phoenix residents' association chairwoman Anne Monaghan says: "I would have moved from a bigger house in not quite as prestigious a location to live here, but there wasn't any downsizing in price. It's location, location, location.
"Nobody would blame them [residents of Phoenix Gardens] if they were offered an absolutely exorbitant price. These houses would certainly not be valued at anything like what is being offered."
Rumours too have been circulating that St Brigid's GAA club, whose ground backs on to Phoenix Gardens, would be prepared to sell their camogie pitch for the right price, significantly expanding the scale of any future development.
O'Doherty, who is a member of the club, says he heard the rumours while he was watching a match there.
"You could almost describe it as The Field. I was talking to one of the guys from the GAA about a match and within a few minutes he was getting a call asking him if he was selling any land to 'that developer', even though I'm not a developer."
The "guy" in question, St Brigid's club chairman, Paddy Davey, put a statement on the club's website saying that no approach had been made by any developer.
"He is a member here and he was telling me the craic while we were watching a game," says Davey. "I was just talking to him and I said, 'How's it going?' People saw me talking to him and thought there were deals going on, and that's where they got these rumours from."
The phenonmenon of collective selling is likely to become more frequent in the coming years as the switch continues from low-density to high-density developments, adding a potential multiple to the value of modest homes in nice neighbourhoods.
It can generate eye-watering prices on paper, but the reality is extremely difficult, as Remax estate agent Karl Mulligan has found. He was involved in three high-profile attempts last year on behalf of developers to persuade entire streets to sell up.
One involved 18 houses in Meakstown Cottages in Finglas, another involved about 30 houses nearby in Ballygall Road and a third in Loughlinstown involved a smaller development of eight houses.
All failed because the collective will to sell up didn't exist. "Some of the demands were out of any ballpark in terms of realism," he says.
"It's very cumbersome when there are a lot of people involved to juggle that many individual agendas and expectations. The greater the number of vested interests, the harder it is to manage."
Even when the collective will does exist, it can be difficult. There was great hoopla surrounding the attempts of five neighbours in Cabinteely to sell their well-appointed homes for a collective price of €35 million, but the deal has not materialised.
"They were looking for too much in the present climate," says David Bewley from Lisney, who handled the attempted sale. "The houses are no longer on the market and they are happy back living in them again."
The current state of the market is a double-edged sword for the residents of Phoenix Gardens. A €2 million windfall would go far in the current climate, but would any developer want to pay that kind of money with such uncertainty around?
"Could a developer sweat the asset to get the kind of return that would mean that everybody could get this kind of money? That is under challenge," says O'Doherty.
"Houses in Castleknock are already dropping. In everybody's favour is that if you have the larger houses coming down in price, and you have cash in hand with nothing to sell, you'd be in a good position. But getting to that position could be difficult."