Dublin City Council officials say much of the reason for the higher cost of building social housing is because they are built to a higher standard.
They were responding to reports that developers charge the city council around €100,000 more in construction costs than the average construction price found in a study by the Society of Chartered Surveyors Ireland.
Mark Bourke, Chief Quantity Surveyor with the city council, told the Housing Committee there is a price difference due to higher standards for local authority built homes.
He was speaking after city councillors voted to accept a report on the Oscar Traynor Road site calling on the council to build 853 social and affordable homes itself rather than hand over construction to a developer which would mean 50% of the units going private.
Mr Bourke said social housing built directly for Dublin City Council use more expensive facades and heating pipes and overall have a BER rate of A2 compared to the private sector average of A3.
Mr Bourke said that the city council spends more money because this leads to lower long-term maintenance costs for the council.
He said private developers would often take a different approach as they are selling the properties on.
He said there is also higher spec in social housing as average floor space for a two-bed social housing unit is 91sq.m, compared to 72sq.m for a private build; the ratio of apartments per lift shaft is an average of 3-4 on each floor in a social housing development, while it is 8-9 in a private build.
Mr Bourke said the council is not "paying over the odds" but there is a "premium" charged for the cost certainty and transfer of risk when a developer carries out a housing project for the council.
There is also increased costs with the procurement process as every project is a different tender with no recurring work. In the private sector, a lower price can be negotiated for multiple projects.
He said improvements being considered are "volumetric builds" where housing is pre-built in a factory that allows greater quality control.
And that breaking up large projects, such as Oscar Traynor, into ten projects of 85 homes each could encourage more competition by encouraging more medium size builders to bid for tenders.
A report submitted to the committee also said there were extra costs for the council dealing with inner city sites involving access, demolition and decontamination costs while regeneration often involves a live building site within an existing community.
This report from the council's Assistant Chief Executive Brendan Kenny said some of the criticism of the price difference between private and social builds failed to take VAT into account and that "a reasonable level of interrogation and analysis" was "clearly missing".
However, he said it is cheaper for the council to hand over a project to a private developer than for the council to build homes itself.
Mr Kenny quoted an all in average cost per unit of over €435,000 per unit including VAT for council development compared to the average cost in O'Devaney Gardens of just €390,000 being charged by private developer Bartra.
He added "the abandoned Oscar Traynor Road project would have delivered social and affordable housing at similar prices".
Speaking after the meeting, committee chair Cllr Alison Gilliland (Labour) said the extra costs of the council leading the project had to be balanced with a loss of 50% of housing to the private market and possibly a Real Estate Investment Trust if a developer took over.
She said "the maximum benefit of the site must be for those most in need of housing and those struggling with high rents".
Councillors want the 853 homes at the Oscar Traynor site to be 40% social, 40% affordable rental and 20% affordable purchase.
The plan will now go to a full council meeting.
