Media: Why the Government refuses to intervene in the housing crisis

The_Conductor

Note- this article is behind the Irish Times Paywall.

Link here: https://www.irishtimes.com/business/construction/why-the-government-refuses-to-intervene-in-the-housing-crisis-1.3197148

Its also in the print version of today's Irish Times- under 'Commercial Property'.

Its a discussion of why the government are insistent on pinning the property crisis on the private sector- and will not be building large numbers of local authority and social housing estates nationally.

The manner in which the article is hidden in the construction pages- rather than given better billing- perhaps on the business pages- speaks volumes........

The big issue in housing in Ireland- is lack of supply of appropriate units- where people want to live.
Simply pointing at the fact that the government have a fund of 6 billion to tackle the sector- patently is insufficient- actions are needed- supply has to be freed up- particularly in the main urban areas.

We can discuss how to deal with these issues ad nauseum here in this forum- even people of completely opposing viewpoints- will agree that the current systems in place are incapable of unlocking the supply side issues.

Using a scapegoat(s) to blame the ills of the sector- to have someone to point fingers at- is ineffective point scoring. We need to relax planning rules, height restrictions, density guidelines etc- and get building- where people want to live.

L1011

The article is very prominent on the app so I wouldn't put much in to its positioning in the print version. Weekday print is a distraction to papers

Making assumptions on future social house build volumes from those done by the last government is ridiculous as there was neither the cash or the demand for most of time and governments are not rewarded by the population for forward thinking

Teyla Emmagan

The_Conductor wrote:

Its a discussion of why the government are insistent on pinning the property crisis on the private sector- and will not be building large numbers of local authority and social housing estates nationally.

You are a great man for getting out of the bed early.

I quote the bit from your post that I agree with the most (and which is most puzzling to me). This is exactly what the government are doing and it makes no sense at all long term. We need more building. We need more social and affordable housing. You can't push it into the private sector because there simply aren't enough units available.

My brother lives in a new estate. They are launching off the plans this morning and at 8pm last night there were already 7 cars settling in outside to queue up for the night. He bought a 4 bed last December and they are now selling 3 beds for 50k more.

If the government are afraid of another building boom and bust then it's too late. We are at crisis point. The lack of housing will cause enough of a blow to the economy. We already have post Brexit firms reconsidering Dublin because of it.

As for the Irish Times, they have been running a hilarious string of landlord bashing articles this week. Lots of hyperbole and hearsay. My favourite was the girl who nearly went homeless when she moved up from home in Maynooth. You know Maynooth, about 25 minutes way on the train.

Askthe EA

Teyla Emmagan wrote: »

You are a great man for getting out of the bed early.

Leo approves!

pwurple

The govt HAS and DOES intervene in the housing crisis.

Repeatedly.

And makes it worse every time.

- Rent increase cap at 4% and unbalanced weighting of rights for overholding tenants. Causing landlords to leave property vacant and simply appreciate in value rather than deal with delinquent tenants and a loss, leaving shortage.

- Taxation for landlords vs pension (vulture) funds. ~50% vs 3% corporate tax. Causing landlords to leave the market or leave property vacant, leaving shortage.

- Local govt zoning, refusal to allow mixed residential with commercial, cap on heights of buildings. I can't understand why they silo residential into these house farms, provide no transport services whatsoever, then moan and groan about the expense of maintaining our spaghetti of roads and other infrastructure. Let people live near where they work ffs!

- Tax individualisation. Controversial perhaps, but disincentivising the existence of single income families has driven up childcare requirements to epic proportions, and produced a bubble of double income families who have this large amount to spend on paper. I'd love either myself or my husband to drop a salary, but the tax situation here for families is chronic. It's not feasible for us.

koheim

The Government is not really intervening, all they are doing is responding to symptoms with short term measures.
They do not tackle to root cause as this is absolutely not FG or FF policy. For the last 25 -30 years the government has depended on developers to provide all housing, it has been outsourced and privatised, and this policy will not change.

The housing situation will not be resolved with the current policies....

xpletiv

Sure half the TD's are landlords. They're hiking their income up with rent. Why would they change it?! It benefits them directly. Not the country. They dont give a ****e about the country.

Askthe EA

xpletiv wrote: »

Sure half the TD's are landlords. They're hiking their income up with rent. Why would they change it?! It benefits them directly. Not the country. They dont give a ****e about the country.

A third apparently. Mind you, if you have a pension, you're probably a landlord too.

pwurple

xpletiv wrote: »

Sure half the TD's are landlords. They're hiking their income up with rent. Why would they change it?! It benefits them directly. Not the country. They dont give a ****e about the country.

Oh for goodness sake. Anyone with a pension is a landlord via a vulture-fund.

And does that mean that the remainder of them are responsible for bending landlords over and screwing them? Because that's what's happening.

benjamin d

Surely the only way out of this mess is a vast programme of social house building. Aggressively CPOing vacant urban land or at least imposing draconian penalties to enforce its development will be necessary.

A huge drive to build social housing would help clear up the council waiting lists while freeing up property for renters, which would ease rent pressure and also bring more housing to the sales market.

This mess was set in motion in no small part when governments washed their hands of their responsibility for social housing. It's a no-brainer for me, what's the issue?

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awec

benjamin d wrote: »

Surely the only way out of this mess is a vast programme of social house building. Aggressively CPOing vacant urban land or at least imposing draconian penalties to enforce its development will be necessary.

A huge drive to build social housing would help clear up the council waiting lists while freeing up property for renters, which would ease rent pressure and also bring more housing to the sales market.

This mess was set in motion in no small part when governments washed their hands of their responsibility for social housing. It's a no-brainer for me, what's the issue?

€€€€€€€ presumably.

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benjamin d

awec wrote: »

€€€€€€€ presumably.

We have a multibillion euro annual housing budget and homeless industry. We're throwing good money after bad at this stage. I don't understand why we can't spend those billions on actually building houses rather than papering over cracks and fudging useless measures that were and are never going to work.

benjamin d

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AND - a change to the current policies whereby a council house is for life.

Many many people living in council houses paying rents far below market rate who earn enough to rent privately but choose not to.

It should be reassessed yearly and if over a certain income threshold then notice given and the council tenant should enter the private market.

I agree in principal, but it's encouraging those in council houses not to improve their lot. It should of course be reassessed yearly but when improving your income might result in eviction from your house you'll entrench a lack of engagement with the social contract IMHO.

Bredabe

Local Politician told me that he wouldn't support changes to housing market on the basis that if ppl weren't smart enough to buy in the boom, with cheap credit and all that, he wouldn't want them as tenants and by proxy they deserved what they got.

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GavMan

benjamin d wrote: »

Surely the only way out of this mess is a vast programme of social house building. Aggressively CPOing vacant urban land or at least imposing draconian penalties to enforce its development will be necessary.

A huge drive to build social housing would help clear up the council waiting lists while freeing up property for renters, which would ease rent pressure and also bring more housing to the sales market.

This mess was set in motion in no small part when governments washed their hands of their responsibility for social housing. It's a no-brainer for me, what's the issue?

And in the process create more Ballymuns and the likes? We've been down that road. No thanks

benjamin d

GavMan wrote: »

And in the process create more Ballymuns and the likes? We've been down that road. No thanks

I'd like to think (hope!) lessons would have been learned from that. And for every Ballymun there are many more council estates that you'd never hear about because they simple aren't an issue.

L1011

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Uncap the differential rents until they reach markets rate for those that can afford it. Your idea will ensure people deliberately refuse better employment

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artichoke

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Exactly. It shouldn't be a house for life. It should be reassessed yearly. There are people continuing living in 3 bedroom houses long after their children have moved out blocking up space for families.

Why not building apartment blocks for low income families? What needs to change is the Irish mindset about house ownership. Most people in European capitals live in apartments. It is not any longer financially sustainable to build council houses. The money is better spend on building apartment blocks.

jamesthepeach

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Some will. But there will always be free loaders.

Many wont. Especially those with kids who want them to go to school in a better cachement area.

Its a competely unworkable idea right now obviously as we have a housing crisis, but it should be part of a suite of measures taken (along with building more houses and more houses and more houses) to address this crisis.

In fact, if the council were smart about it theyd get into the business of private landlording and offer the social tenants that have the means to move on private rental accommodation - thus assisting them make the move AND earning a good income off it.

Then you would have the usuals out crying because those who have less are not first in the queue. Ie the freeloaders.

L1011

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Uncapping the differential rents system does this automatically, without any need to have two sets of housing stock etc.

Tenancy is still for life but you pay the full market rate if you can afford it. The differential rent system works, the capping is too damn low and that is the only thing that needs changing to fix it fully.

Ray Palmer

benjamin d wrote: »

I'd like to think (hope!) lessons would have been learned from that. And for every Ballymun there are many more council estates that you'd never hear about because they simple aren't an issue.

The worst neighbourhoods in the country are all council estates. I don't know of a single council estate in Dublin that is not known to be a social black spot. Some have become nicer but still an issue after 60-70 years. Segregation of people has never worked well.

Brioscai

What if the council just started to build estates with say 20% social and the rest just for rent under free market?

Then move differential rent cap? Rent capped at a % of household wage.

MayoSalmon

Ray Palmer wrote:

The worst neighbourhoods in the country are all council estates. I don't know of a single council estate in Dublin that is not known to be a social black spot. Some have become nicer but still an issue after 60-70 years. Segregation of people has never worked well.

Segregation has literally nothing to do with it! The behaviour of the people living in those houses do!

jamesthepeach

MayoSalmon wrote: »

Segregation has literally nothing to do with it! The behaviour of the people living in those houses do!

Funny how 90% of antisocial behaviour is in a certain type of house.
But it will spread. Now that landlords can't evict people any anti social bahviour in rentals will just stay there too. It can't be removed by the landlord anymore.

Wanderer78

Our government and its advisers have been indoctrinated for many years, decades in fact, with fundamentally flawed economic theories and thinking such as the 'efficient market hypothesis'. As far as I can see 'the market' is a 'construct', I.e. we have absolutely no definitive evidence that if left to market forces, all our needs will be met. In fact there's mounting evidence that market models such as dsge models fail periodically to predict market outcomes, the most common being the failure to predict booms and busts. We need to move on from all this equilibrium nonsense before we do serious damage to our societies.

Sadly, I'm not sure our housing crisis will ever be solved, as these ideologies have become so deeply imbedded in our society, leading me to believe, it may take a few more serious financial and economic crisis before we accept these issues and begin working on possible alternatives. I wish those currently traumatised by their experience of being made homeless, the very best of luck, it must be a devastating experience. Not only do we urgently need to start building social housing for these people, but we must to start preparing for the extremely complex social issues that this outcome will have produced, unfortunately some of these issues will be irreversible and costly to all.

Peter Flynt

Ireland under FF/FG/Lab have long since signed up to the neo-liberalist, dog-eat-dog agenda from the far right where the market will provide everything and if you cannot afford or pay for something then tough. As a former Tanaiste once said "We're closer to Boston than Berlin".

A country where bank debt is socialised and those who are repaying that debt are left either on the streets or at home with their parents as the roots of the present housing crisis all go back to 30 Sept 2008 when those fat fools Lenihan & Cowen both decided to carry out the biggest scam in Irish history.

Now we have those same institutions running adverts saying "Why don't you move back in with your parents?" as the number of millionaires increased during the era of austerity and the gap between the rich and the poor widened significantly.

Ireland has many more now among the poor ranks as a result - those who work in former respectable middle class jobs.
A country where over 50% of income is taken after €34,000 in earnings but which cannot supply basic social housing because er. . . .just can't be arsed.

rawn

artichoke wrote:

Exactly. It shouldn't be a house for life. It should be reassessed yearly. There are people continuing living in 3 bedroom houses long after their children have moved out blocking up space for families.

It IS reassessed yearly. My dad lives in a council house and has to provide payslips for himself and everyone in the house once a year and the rent is adjusted accordingly.