The Housing Crisis - What actions would you take to improve things?

[Sophrosyne]

Very interesting post @ lff12

Do local authorities talk to each other at all?

For instance, is there any cross council cooperation in the provision of housing?

This, of course, would depend on all local authorities holding the same information in the same way.

How do they keep their housing lists current? Do they rely on applicants informing them when they no longer require housing at all or within their own bailiwick?

 

[blueband]

Start a massive state funded social housing building project, like we did in the 50s 60s 70s we managed to do it when we had very little money as a country, why not now? Get rid of all private landlords, the only landlord should be the state.

 

[Protocol]

I think the outcomes of public policy on housing should be the following:

(1) residential rents to halve from current levels

(2) house prices to fall from current inflated levels, by maybe 20%

How that might be achieved, I will post later, too busy now.


See below for data from Eurostat.

The 4,500 to rent a detached house is obviously insane, and needs to fall below the levels in Paris, Stockholm, Bern, etc.

 

[Life_pondering]

I don’t exactly know if it can be addressed but having net immigration figures of around 100,000 a year while we have no surplus accommodation is the real issue here. This isn’t an anti-immigration rant, Immigration as a general concept is fine but this seems mad when we cannot cater for the people here already.

 

[T McGibney]

"Start a massive state funded social housing building project, like we did in the 50s 60s 70s we managed to do it when we had very little money as a country, why not now?"

Those houses were built with almost slave labour without any consideration or building standards. Good luck repeating that.


"Get rid of all private landlords, the only landlord should be the state."

Private landlords have been exiting the market en masse in recent years. Tell us how that has improved things.

 

[The Horseman]

Start a massive state funded social housing building project, like we did in the 50s 60s 70s we managed to do it when we had very little money as a country,

What about the antisocial issues? Why do you think certain areas have certain reputations?

Who pays to meet current building standards? With limited tradesmen they will go to whoever offers the higher wage so prices go up.

 

[blueband]

Antisocial issues will always be with us, thats life. Contract the building work out to foreign companies, give them long term ten year contracts.

 

[Purple]

The first time I noticed an incipient crisis was on a day out in Dublin on the day that Osama bin Laden was killed. That was almost 14 years ago.

It's been a full blown crisis for almost as long.

There are around 10,000 people in emergency accommodation out of a population of over 5 million. Housing costs, as in the average amount of income people spend housing themselves, are amongst the lowest in the EU (mainly due to HAP and other subsidies). We certainly have a big supply side problem. That's caused by State inefficiency and a labour shortage.

The crisis has persisted and gotten worse because in the meantime no political or civil service policymaker has only admitted let alone confronted the ugly reality that it was their decisions after the 2008 crash that caused it.

The same housing problems are evident across much the developed world. Ours should be considerably worse because we have a growing population, our 2008 crash was possibly the most severe in the world and we are an island.

That said the decisions made by the State have made it worse. They then throw money at the problem in order to ameliorate the negative impact of their bad decisions. More particularly the decisions not made are an issue, around reforming planning, having a functioning database showing ownership of land and property, rent controls and the appropriate application of property taxes as a tool to reduce land hording and control property prices.

 

[Purple]

Start a massive state funded social housing building project, like we did in the 50s 60s 70s we managed to do it when we had very little money as a country, why not now? Get rid of all private landlords, the only landlord should be the state.

The State got poorer in real terms throughout those decades. We had considerable net emigration during that period. It was only when we moved from those stupid policies and started investing in our human capital through education and healthcare that the country started to thrive.

 

[Zenith63]

How that might be achieved, I will post later, too busy now.

Love this! It’s basically the approach successive governments have been taking, right down to the fact that you/they never actually come back with a solution

 

[Leo]

we managed to do it when we had very little money as a country, why not now?

Because now the local authorities find it significantly cheaper to buy privately developed housing rather than build themselves.

 

[Purple]

Because now the local authorities find it significantly cheaper to buy privately developed housing rather than build themselves.

And during much of that period we actually reduced the net amount of housing units because we were emptying out multi-unit tenements where families shares a couple of rooms and moving them to newly built council houses.

 

[BIG-notorious]

The basic principles of economics & taxation say you should reduce taxes & regulation and increase spending on goods/activity you want to support.

So if I could wave a magic wand I would, with effect from midnight and for all new homes sold (to investors, local authorities, AHBs, or owner-occupiers) for less than €500k completely eliminate:

• All developer contributions: for roads, connections to electricity, water, public transport, the lot
• VAT on all elements of construction: materials, professional fees, solicitors fees, literally everything
• Stamp duty
• Land registry fees

I would also increase the flat rate allowance for all crafts & labourers in the construction industry by probably 100 times. A labourer currently gets €97, increasing this to €9,700 would seriously increase the spending power of a labourer etc making the job more attractive without costing the employer a penny.

I'd have the state paying at least half of the wages of all apprentices in the construction industry while also increasing 1st year apprentice wages to the minimum wage.

I'd introduce the rent-a-room scheme threshold to €24k a year and enable landlords to avail of it: if your aggregate rental income is 23,999 you pay no tax, prsi, usc, but if you take in 24,001 you pay everything at the marginal rate.

I'd introduce government guaranteed financing for apartment developments, similar to the low cost energy retrofit loans.

I'd make the construction (within certain size limits) of a separate residence in your back garden an exempt development.

I'd make adding a floor to your residential property (up to at least 3 floors) an exempt development.

I'd make it illegal to build anything less than 6 storeys high within the M50.

All this would cost a fortune, but the housing crisis is already costing a fortune. And while it would help developers make millions, developers and their staff/subbies aren't going to work for free or even for cheap to help solve the housing crisis out of the goodness of their hearts.

The one thing I wouldn't do is reduce energy efficiency & fire safety requirements for new builds.

I have difficulty believing the government (or the alternative) have the imagination & will to actually solve the housing crisis or make a serious dent in it within the next decade. Partly because they're so concerned about repeating the mistakes of the past: a risk that's anyway largely mitigated through the existence of the central bank lending rules and central credit register.

 

[lff12]

Again I go back to Prof Michelle Norris seminal essay on financing social housing prior to the 1970s, and the one point which she makes very clear was that for a large proportion of people in that era, social housing took the place of social welfare. Even as late as the early 1990s you couldn't sign on as a young adult living in the family home without having your families incomes counted as means.....which meant that you got zero pounds, zero pence and .....butter vouchers.
Housing was provisioned for some (remember there was a major issue with slum housing that persisted right till the end of the 1960s) in lieu of social welfare. And like today, housing was built as a priority for families, not young single men or women with no children. There were very few small flats (and only flats) built for single people and these were tiny and basic. It might come as a shock to young people who think they should get €244 a week in social welfare AND social housing that if we were to return to the policies of that era they would get no money and no housing, as all the housing would be prioritised for families and the elderly, and they were at the back of the queue until they either had a family or became old.

 

[Purple]

It might come as a shock to young people who think they should get €244 a week in social welfare AND social housing that if we were to return to the policies of that era they would get no money and no housing, as all the housing would be prioritised for families and the elderly, and they were at the back of the queue until they either had a family or became old.

And that was getting married and having a family, not having 4 kids with three different men so that you could get a free house.

 

[letitroll]

The predicted output for housing completions in Ireland in 2025 is 23,000 housing units.

Not 40,000 and certainly not 60,000 like we need. The country is headed for a brick wall socially and politically.

The government thanks first to Coveney (who introduced rent pressure zones and then subsequent Housing Ministers/cabinets expanding RPZ coverage such that it encopamesses most of the country from a population perspective ......have got themselves into quite the great BIG hole politically and from a pure housing perspective.

It was all very predictable for anybody who has studied blunt price controls of anything.....the supply of that thing is smaller than it would have been otherwise and if that weren't bad enough the quality of the product/service goes down too...rent controls favour incumbent holders of rental properties at the expense of prospective future renters......its the exact opposite of course of what's required to solve a lack of housing in your economy.

The other political problem of rent controls is what the current government is experiencing right now as they try to figure out a way to reverse course on this disastrous policy - which is rent controls create a political constituency who start to look at their rents as being something akin to taxation i.e. the government decides how much their rent should be. The tail starts to wag the dog.

I really hope as this government starts to review RPZ's that they build a solution that can exit the country from this tyranny - the most logical solution I would posit (I'll leave the political calculus to the politicians) is to set a sunset clause to RPZ I dunno 7-10yrs out and in the interim allow for CPI + 3% rent increases (rent increases HAVE to be linked to CPI or no investor worth his salt would sign up for a risk asset without some type of inflation protection built-in hence why PRS folks exited the market that and bond yields of course).

Time also I'm afraid to shower developers and investors with all sorts of tax breaks......if you want less of something you tax it......if you want more of something you subsidize it.

Time for Michael Martin & Simon Harris to show some political courage.......sign up for punches to the face from Mary Lou and the left....but do the right thing for the country.....I can almost ensure them both that they've already lost election 2029.....the 300,000 homes they promised over the lifetime of this government will be lucky to exceed 100k on the current trajectory. Time for radicalism not incrementalism.

 

[Sister Sara]

Individual landlords letting private rented accommodation will, naturally, want to see a rate of return that is worthwhile on their investment during the course of their (career) lifetime. That is, say, over 40yrs. Then, not unreasonably, they will sell the property for maximum market price and the property itself is re-cycled into the housing market again over another 25/30yr mortgage period. In turn, if used for rental accommodation, then tenants face paying high rents otherwise its not the worth the landlords time.

I suggest that all rental accommodation be designated as such for mortgage purposes. That the mortgage is adjusted to extend over, say a 120yr period (reasonable lifetime of a well-built house without need for major structural repairs).
This would drop the mortgage repayments on the property by a significant amount. In return, the landlord is restricted from charging a rent that would exceed the mortgage repayment plus, say 33%.

After 40yrs, the landlord retires and sells the property. Either to private home-owners who take on their own mortgage, or to another landlord who then continues the second 40yr phase of the 120yr mortgage designated for rent.

This would offer a real affordable alternative to home-ownership and provide tenants with affordable priced rental accommodation.

I hope this makes sense notwithstanding some obvious omission or misunderstanding.

 

[Howth Head]

The country is headed for a brick wall socially and politically.

Agree with this. We currently have the very definition of a "perfect storm."

Housing-For-All meets Ireland-For-All.

While most of the suggestions above have merit, the rate of population increase is simply staggering, unprecedented and shows little sign of slowing down....

We truly are at breaking point and nothing less than dramatic changes in policy will resolve it - and even then that'll only have an affect in the long term. (The fact that official "homeless" figures are so low given the wider context is an impressive achievement - albeit an expensive one.)

We all know this instinctively but the only way to make even small progress is to radically reduce demand. Nothing else will work...

Irish population growing faster than housing stock

Ireland’s population is increasing at a higher rate than the country’s housing stock. In th...

www.newstalk.com

“Earlier this year, Davy published a report stating that 93,000 homes a year would need to be built every year between now and 2031 in order to meet the current housing deficit, pent up demand and population growth,” he said.

“And with experts saying only around 30,000 new units will be built in 2025, then that deficit is growing – so from 2026 onwards 105,000 new houses and apartments would need to be built per year."

 

[Sister Sara]

"Ireland’s population is increasing at a higher rate than the country’s housing stock.

In the last three years, the Irish population has increased by 208,600; however, between 2022 and 2024, 92,706 new homes were built."

Interesting, but worth noting:

In 2022, there were on average 2.74 people per private household. This is a small decrease compared with the 2016 average, which stood at 2.75. In 2011, there were on average 2.73 people per private household. - www.cso.ie

92,706 new units accommodates, on average, 254,014 persons. This leaves a pressure of 45,414 not in the average household.

I would have thought however, with the housing crisis, that the average size of private household would have increased significantly more between 2011 and 2025.

​

 

[letitroll]

I hope this makes sense notwithstanding some obvious omission or misunderstanding.

By doing this your potentially improving the monthly funding cost of the underlying investment and that can improve its attractiveness for sure.

However linking the max rent to 33% over mortgage payments is a version of price controls in another form - while it also exposes rents in Ireland to mortgage like interest rate fluctuations which is not something policy makers would be eager sign up for I think. Already the household cashflows of so many are tied to ECB rates not a good macroeconomic idea to take the renting population and expose them their household cashflows to ECB rates too.

The answer like so many things is to quit with the artificial manipulation of price & price signals and focus on ensuring there is robust & dynamic competition in the building sector with adequate resources (zoned serviced land & skilled labor) available to deliver 60,000 homes p/a....and then get the hell out of the way and let the private sector at it in terms of the provision of private homes & private investors at it in terms of the provision and price at which they would rent homes to the private sector. I keep saying private sector as I do believe there is a place for government in the provision of accommodation to those for whom their purchasing power does not allow them to acquire a home in the private market.....these two markets need to be bifurcated ASAP even that is probably a decade long problem....it is insanity that so many HAP supported tenants compete with private tenants for the same units.