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

[bkenn14]

I suspect the average size of new private owned new homes is well below 2.74 per household,

We possibly need more new houses than the stats say we need,

should Government help/grants be tilted/aimed at assisting new home owners over 2.74 per household,

I would say it would bring down the price of housing as there would not be as many single people competing for new homes,

we would be assisting people in long term renting into new homes which is where the real pressure on Government is,

single people would be sharing housing for longer, at present we are using taxpayers money to put more pressure on the problem we are trying to solve,

 

[letitroll]

the rate of population increase is simply staggering, unprecedented and shows little sign of slowing down....

Yep - housing is just deeply inelastic good.....every incremental increase in the adult population is really gasoline on the fire in terms of the supply/demand imbalance....there really does need to be a strategy around demand control....while supply ramps up.

 

[bkenn14]

yep - housing is just deeply inelastic good.....every incremental increase in the adult population is really gasoline on the fire in terms of the supply/demand imbalance....there really does need to be a strategy around demand control

like,
We need to be realistic on what we can do and how we allocate taxation to solve our housing problem,

i know this will draw fire should we be spending/giving taxation money to people who can afford to buy already which is only driving up prices on people further down the housing ladder when we have no way of ramping up supply at present,

we should be cooling down demand not inflating demand with tax breaks where it is not needed,

 

[bkenn14]

.while supply ramps up

the problem is we will not admit we cannot ramp up housing to meet supply and are wasting tax payers money on people at the top of the ladder driving up prices,
Taxpayers money is been spent to jump the queue and increase house prices, more taxpayers money need to be spent on those left behind to provide social housing,
Madness,The Government has more money than since,

 

[jpd]

We can't ramp up supply largely because of things that are under control of the state - planning delays, lack of infrastructure, uncoordinated utilities investment

If these were sorted, the private building sector would build all the houses needed

 

[Howth Head]

Is there any way of calculating the expected level of demand if the supply side is ramped up and prices ease?

In the "old" days (i.e pre large inward migration) it was much easier to plan for, in that the native population was relatively static - or at least more predictable.

If say, we have an employment demand in the coming years for a large cohort of low-skilled workers who would qualify for social housing - and if more of the latter became available, would the demand increase?

Up to a decade or so ago the Department of Justice used to talk about "pull factors" - a phrase which is rarely used today. But they built policies around that obvious element of demand for asylum. It could equally apply to work permit demand...

* I note the Department of Enterprise last year not only issued an all-time record number of work permits (45,000) - but they added 43 additional occupations that were not previously eligible for work permits. And just to add - family members can join some WP categories immediately while the rest can apply to have spouses/children join them after 12 months. So you can probably double that 45,000 number at the very minimum. (11.5K permits were issued in the first 13 weeks of 2025. If that rate stays the same we're looking at over 40,000 for all of 2025 - which is still higher than 2023's figure of 38k.) Those numbers alone are enough to fill all new builds and more...

Highest ever number of employment permits issued in 2024

This rising demand for work permits is driven by an increase in economic activity against a backdrop of full employment

www.gov.ie

 

[bkenn14]

Up to a decade or so ago the Department of Justice used to talk about "pull factors" - a phrase which is rarely used today. But they built policies around that obvious element of demand for as

I know at one time in built up area of Austria they had a system if you were renting and saving to buy a house or apartment you could open a special account for five years which gave you a discount on your mortgage interest rate, they used this to plan local housing needs,

 

[letitroll]

we should be cooling down demand not inflating demand with tax breaks where it is not needed,

The demand side (outside immigration/asylum numbers) is not really for the government to control - I think there is logic to stemming the flow of economic migrants masquerading as asylum seekers or ensuring speedy processing & deportation for those who are clearly economic migrants.

Absent these migrants Ireland is simply structurally short homes of a certain type (3-bed semis) in places where people want to live basically Greater Dublin Area, Cork Area & Galway Metro.......

If these were sorted, the private building sector would build all the houses needed

Not so sure about that - you ever look at Glenveagh Properties and Cairn Homes financials?......these are the large PLC housebuilders in the market, huge scale, advantageous cost of capital, deep planning and land acquisition teams...with all these advantages...together they average about a ~15% return on equity and 15% underlying operating margins......not a terrible assumption to make that sub-scale builders would be lucky to be doing half those numbers......7.5% return on equity & 8% operating margins!!!!!!!.......given the cyclicality of homebuilding, the long asset turns and the capital intensity of this business these are not super attractive business metrics. Loading up purchases as been the governments defacto method of developer subsidies......and it hasnt been enough to make a terrible business (building homes) much more attractive.....simple logic would tell that if you building homes was damn lucrative we'd have alot more of them being built than pathetic 23,000 we are going to get this year.

 

[bkenn14]

Is there any way of calculating the expected the level of demand if the supply side is ramped up and prices ease?

we also have a new local problem where a separated/divorced persons house has to be sold after child reaches 18/23 years not able to buy another home with the share of house received while the amount of homes do not decrease the amount of homes required for renting goes up leading to more taxpayers support required long term,

 

[bkenn14]

The demand side (outside immigration/asylum numbers) is not really for the government to control ,

But they are by giving taxpayers money to the better off at the top of the ladder they are increasing prices for people further down the ladder putting owning a home out of there reach unless the spend more taxpayers money,

 

[bkenn14]

not a terrible assumption to make that sub-scale builders would be lucky to be doing half those numbers......7.5% return on equity & 8% operating margins!!!!!!!.......given the cyclicality of homebuilding, the long asset turns and the capital intensity of this business these are not super attractive business metrics. Loading up purchases as been the governments

governments defacto method of developer subsidies......and it hasnt been enough to make a terrible business (building homes) much more attractive.....simple logic

lots of housing built and sold at away better value than the large PLC housebuilders in the market,

 

[skrooge]

Given the thread is about improving things, I'd like to see some smarter building policy to reflect the different stages of life and improve options for older people to downsize.

We have lots of people and lots of houses - while we need more we could also be cleverer with the existing stock. Plenty of empty nesters knocking around big houses. I'm not suggesting anyone is forced out but if even a small proportion of developments had a few 1 or 2 bed bungalows in there it might tempt some people to downsize thus freeing up existing (larger stock).

As it is we're building state of the art homes under an 80s style starter home policy. We built (relatively) cheap homes and they were sold to people just starting off in life. Now we're building Bentleys wondering why the old model isn't working like it use to. I'm over generalising but you can't sell the most expensive homes to the least wealthy households without massive social transfers. Whereas encouraging mobility is likely to benefit many and cost the tax payer less.


When I'm old and (hopefully) wealthy I can see a newer property (not in need of repair/renovation) being very appealing but if all I'm faced with is a three-story house and a pair of dodgy knees then no thanks. Likewise when I was younger the thought of buying an older bigger house - that I could modernise (with the aide of existing government incentives) and get the benefit from for a decade or two as I raised a family - would have been much more appealing.

 

[TomEdison]

The demand side (outside immigration/asylum numbers) is not really for the government to control - I think there is logic to stemming the flow of economic migrants masquerading as asylum seekers or ensuring speedy processing & deportation for those who are clearly economic migrants.

This is a matter of current political controversy, but it would be easy to overstate its significance to the housing crisis (and in fact it is routinely overstated).

As of July 2024 (I don't have a more current figure readily to hand) there was a total of 31,473 people seeking international protection in Ireland. But there are 1.07 million people living in Ireland who weren't born here. Clearly, immigration is a very significant factor. But, equally clearly, imigration by asylum seekers isn't a material part of that; just 2.8% of the immigrant population are asylum seekers. Even if there were no asylum seekers at all, that would only make a marginal imact on migration-driven demand for housing.

And there are other demographic factors besides immgration that are at work as well. Average household size in Ireland is 2.74 persons. This has been falling steadily for years; in 1991 it was 3.34. A moment's thought will show that, even the population size doesn't change at all, a fall in household size from 3.34 persons to 2.74 would require a 22% increase in the number of housing units.

In the long run, the only way of accommodating demographic changes like these is by increasing the supply of housing units. But, as I think we are all agreed in this thread, that's something that can only be done in the long run. If we are thinking of affecting demand for housing by "stemming the flow of economic migrants masquerading as asylum seekers", that's just tinkering at the margins on the demand side; it's not going to make any material difference to the larger picture. But it does raise the question of whether there is anything else we can do to to affect demand for housing? Is it worth asking, for instance, why household sizes have fallen, and whether there is anything policy we might adopt to reverse that trend by, e.g., encouraging more multi-generational housing? Because, on the figures, it looks to me as though that could have a much, much bigger impact on the problem.

 

[The Horseman]

Is it worth asking, for instance, why household sizes have fallen, and whether there is anything policy we might adopt to reverse that trend by, e.g., encouraging more multi-generational housing? Because, on the figures, it looks to me as though that could have a much, much bigger impact on the problem.

It would appear "Multi-generational housing" may have a positive impact in a relatively short period of time with little (from a govt perspective) capital investment. I actually think the "granny flat" scenario merits some in depth examination and is structured in such a way that it has some specific outcomes.

The issue has the opportunity to solve some (not all) of our supply problems. I appreciate it will not work everywhere nor is it intended on its own to solve the issue. We already have the power, water and infrastructure in place for these properties. In the main it could work for downsizer's who want to stay in their area but don't need a three bed semi. Perhaps a family member (normally a parent) who could move into the "granny flat".

How about re purposing existing properties into multiple properties. I know for example some of the older basic three bed semi's could easily be converted into two flats. The downstairs as a one bed property and the upstairs as a two bed property for all intensive purposes allowing current semi's be turned into duplex's.

 

[lff12]

I suspect the average size of new private owned new homes is well below 2.74 per household,

Its not. Less than 20% of our built residential estate is 2 bedrooms or smaller, and as the *minimum* size for apartments (and more quietly, social builds including houses) have rapidly scaled over the past 20 years (despite the modest scaleback in 2015, while still was far bigger than the typical "Tiger era" apartment build) the vast, vast bulk of scheme housing is 3-4 bedrooms with a very small minority of units being 2 beds or smaller. Apartment schemes are even more constrained as there are hard maximums on the proportion of 1 bed units permitted, and an additional stipulation that "the majority" of units MUST exceed that already gargantuan minimum size by 10% or more. The result is that your typical tiger era 1 bed of 38m2 has now been displaced by what in the tiger years would have been a luxury style D4 or Blackrock design for the upper echelons of the market, 1 beds sized 50m2 (and sometimes as high as 60m2).

To top all of that off, ministerial guidelines add the following maximum proportions of 1 bed units and minimum of 3 bed or bigger units:

• A maximum of 25-30% one-bedroom units
• A minimum of 15% three- or more bedroom units

Even in "build to let" (which will struggle to get past planning) the absolute maximum limit is extended to "42-50% of the total units may be in the form of onebed or studio units". That's why apartments are so much more expensive now - because most of them are 2 bed units compared to 1 beds in the past.
Gone are the days when you could build a small apartment development of maybe 45:45 1 and 2 bed units with a small few bigger ones for a very small market. Its mostly 2 beds now, for obvious reasons. There's very little market for 3 bed apartments; most people requiring 3 beds would be families and they will buy houses. Even investors will prefer a 1-2 bed to a 3 bed apartment. I assume a lot of these get picked up for social/affordable as part of the part V allocation.

More detail here

16.10.1 Residential Quality Standards – Apartments

www.dublincity.ie

Minimum size for social housing for reference (in practice most schemes for private housing will exceed this): applies since 2007 and one of the reasons home building has collapsed, almost everything is prescribed in detail now.

https://www.opr.ie/wp-content/uploads/2019/08/2007-Quality-Hsing-for-Sustainable-Communities-1.pdf

Note minima on p50 and p51 and these apply to houses (the room sizes also apply to apartments).
Minimum size for 4 bed is 110m2 for a 2 storey and 120m2 for 3 storey. 83-100m2 and 102-110m2 for a 3 bedroom equivalent depending on the target person size. A 2 bed absolute minimum is 70-80m2 for houses. These are binding and any application which isn't a refurb of an older building or Build-to-Let will simply not pass the planning stage at all and many BTL/refurbs will be failed on these also.

I'm not just pulling figures out of my h**e here - there's been repeated studies on this, not least this ESRI one comparing the UK and Ireland with regard to size. https://www.independent.ie/business...k-making-them-more-expensive/a1199467427.html

Like I grew up in a 3 bed late 60s build - 900 square foot - just shy of 84m2 in todays money. This is absolutely at the bottom of the minimum for new builds in 2025 so its simply not true that housing is getting smaller.

 

[lff12]

How about re purposing existing properties into multiple properties. I know for example some of the older basic three bed semi's could easily be converted into two flats. The downstairs as a one bed property and the upstairs as a two bed property for all intensive purposes allowing current semi's be turned into duplex's.

Think the problem there is that most homes are simply not big enough to provide 2 units that would meet the equivalent minimum standard for 2 1 bed apartments. An existing house would have to be 90m2 or more to create 2 separate 1 bed units, while I'm sure most people would just assume that a 3 bedroom house could yield a 2 bed and 1 bed apartment. That would typically require, at the very minimum, 120m2 and would assume all of that space is available for contained space (and that the units would still meet minimum standards). Its probably possible in grand period homes but an awful lot of them are already subdivided as "pre 63s", and in extremely poor condition as well as being far below todays standards.

 

[letitroll]

Is there any way of calculating the expected level of demand if the supply side is ramped up and prices ease?

I think one way to model things is to look at other nations that have reached our wealth/demographics and figure out headship rates. The reality is that as nations get wealthier generally speaking headship rates decrease - not living with too many others is a premium product....as wealth increases folks allocate to living in smaller households

All very academic.......and all very central planning-esque. In some ways who cares about the naval gazing.

The reality with all this housing target nonsense is just that - the target should be to scale the capacity of the state and private sector to deliver as many homes as possible cause nobody can know exactly where equilibrium is in a multivariate equation like housing with so many moving parts and where future economic & immigration trends are fundamentally unknowable.......price is the best signal and is a coincident indicator......supplying product into the market to the point at which rent/house price increases begin to lag behind wage growth is a pretty good indicator that the market is being adequately supplied.....another basic indicator would be too instead of targeting housing numbers.....one should target housing affordability as some multiple of median household income....an adequately supplied healthy market might be one where average housing costs (rent/mortgage payments) represent say no more than 30% of disposal net income.....I can assure you that many renters are breaking that ratio or against their preference they've achieved that ratio by living in household that don't meet their headship preference for their age/income cohort.

 

[Protocol]

and 15% underlying operating margins......not a terrible assumption to make that sub-scale builders would be lucky to be doing half those numbers......7.5% return on equity & 8% operating margins!!!!!!!.......given the cyclicality of homebuilding, the long asset turns and the capital intensity of this business these are not super attractive business metrics. L

Surely a 15% net margin, when the sale of all of your product is guaranteed, is a good return?

€60,000 pure profit per house seems good to me.

On a 100-house site, after several years of planning and construction, the developer makes 6m pure profit, after all costs.

 

[Howth Head]

The reality with all this housing target nonsense is just that - the target should be to scale the capacity of the state and private sector to deliver

This is the key. We don't appear to have the infrastructural capacity...several schemes have already been turned down due to lack of water supply.

And now this in today's Irish Times...

Housebuilding in Dublin to stall within three years if wastewater plant not delivered

Uisce Éireann's starkest warning yet on water constraints follows Government’s revised 2030 housing target

www.irishtimes.com

It was first proposed more than 20 years ago and was granted planning permission in 2019. However, this was quashed by the High Court in 2020 and it is now back with An Bord Pleanála for the last 11 months. Delays to the project have meant the price has doubled and the tendering process for its construction has had to collapse. It is understood the project will take five years to complete once planning permission is granted.

 

[bkenn14]

ts not. Less than 20% of our built residential estate is 2 bedrooms or smaller, and as the *minimum* size for apartments (and more quietly, social builds including houses) have rapidly scaled over the past 20 years (despite t

That is not what i said,
In lots of cases around where i live the larger new builds sold in the last 7/8 years only one person lives in them,
the smaller units appear to be families,