Irish Property Market chat II - *read mod note post #1 before posting*

"strategy of the government attempting to inspire the private sector to build in large numbers" - what? What incentivises did the government put out to encourage building in large numbers?

Deplorable market conditions made by the Irish government everyday gets worse and now they want to buy all the do uppers.

"The state has agreed thousands of expensive long-term social housing leases at a cost of up to €3,200, the Business Post can reveal.

The almost 9,000 deals come at with combined price tag of more than €3.24 billion over their 25-year lifetime, with scores of rental agreements costing the government €2,500 or more a month."

https://www.businesspost.ie/news/exclusive-state-leasing-social-homes-from-private-sector-for-up-to-e3200-a-month/

What a complete and utter waste of tax payer money. Leasing 9000 properties at massive cost, with nothing to show for it after 25 years. And taking those thousands of properties off the private rental market, driving up rental costs for tax payers, while they're at it. A double whammy for all the renters out there paying large amounts of tax.

Its such a daming result of our current government's policy of refusing to just build state housing.

No, effectively what I'm saying is the state should have built 9000 social houses to house those families, instead of very expensively leasing housing from the private sector. As was social housing policy at every time in the history of the state until the failures of the 2010s and 2020s.

Do you think the state spending billions of euro to lease social housing at €3200(!) a month is good value for tax payers? Do you think its good for the tax payers in the private sector rental market having those 9000 homes taken out of it, that they now have to compete with the state for the very limited number of properties available?

The lack of workforce argument has been debunked recently by construction industry reps themselves - it's a question of viability mostly and lack of finance that holds back construction.

For state built social housing the viability risk is gone - they put it out to tender and contractors can build houses with a guaranteed buyer and guaranteed price. The state could even forward fund and take the financing costs out of the equation.

Instead they agree leases that over 25 years term will more than cover the build costs of the property. The most egregious example of short term only thinking

The NCH is as much due to scope creep as it is due to BAM gaming the tender system.

NCH spec from initial tender to current hospital is (literally) millions in the difference. Those failings lie with the department.

Social housing is nowhere near as complex as a world class hospital

The state built large numbers of social housing for most of its existence. While in a corruption riddled, desperately poor state, for most of that. So its beyond ridiculous to handwave the idea away as something impossible to achieve.

The workforce claim has been debunked multiple times in this very thread - we had as many construction workers in the state in 2023 as in 2005, but built a fraction of the housing. The difference is far more are building non-housing projects now, which is down to government policy/incentives (or lack thereof).

Planning is still bad but its less bad than it was at any time in the past, its very incrementally getting better.

If they state had engaged in a widescale training programs years ago - at any point in time after the housing crisis first began to be identified a decade ago in 2014 - it wouldn't have had any impact depressing private development. That problem is completely possible to mitigate for. In past decades there was no problem with both social and private developments happening at the same time.

The "many other important reasons why State building on the scale some here believe should have been done" somehow didn't stop the state building tens of thousands of social housing units in other decades. So the lived evidence would very much suggest its far more likely that whats changed here is us having a FG controlled government for most of the last 13 years, that for the first time in the state's history focused on a neo-liberal laissez-faire approach to the housing market as a matter of core principal. Which has now resulted in the terrible housing market situation we find ourselves in.

I was listening to an economist talking about the building of social housing particularly in the earlier years of the State, he made the point that this coincided with the handing over of responsibility for running the schools and healthcare to the religious orders, allowing the state to focus time and resources to the problem of housing. And the decline in State housing in turn coincided with the State retaking responsibility for eduction and healthcare, and all that involved.

There is no benefit in looking back on how things were 40 years ago, the world today is very different.

If we have so many construction workers, why is it so damn hard to get any tradesperson at the moment, and why are contractors struggling to find labour?

I suppose it depends on the area. I finished some construction work on a garage earlier in the year, what should have taken two months took nearly 5 due to shortage of labour. I know the contractors, they have done work for me many times over the last 20 years on various projects, all, electrical/plumbing/joinery/plasterers/roofers said the same thing, they were turning down jobs because they couldn’t get labour.

Commercial and hotels have seen huge investment in last 6 years, commercial is dying a death now though with big oversupply. This is where most of trades are coming from.

Sparks are diversifying into solar panels as commercial work has dried up, but most will happily work on residential when it arises as the pipeline of solar installs isn't continuous

Suspect that a significant portion of the housing stock should be knocked and rebuilt, let alone retrofitted. Ain't gonna happen given how had things have become though.

While the state provided the majority of funding for schools, the religious orders provided a significant amount as well. They also provided the management to these schools and fundraised for extras into these schools. This saved tge state significant funds

https://www.rte.ie/archives/2017/1018/913201-kenmare-housing-problems/

This idea that the state was poorer then is a slight misconception. While budgets were smaller demands on the state were less. There was not 20-25%% odd of the population receiving payments of one form or another ( unemployment, disability, OAP carers etc etc) add in health costs and the budget has drastically changed in 50 years.

Another factor the state could manage projects 50+ years ago. Even after that look at tge comparison between the major telecoms development of the 70/80's compared to the Rural Broadband project at present. Except tgat we are so financially well off there woukd be more questioning of the costs. Add the NCH to that. The state cannot no longer directly manage building projects.

TBH most of these espousing mass house building by the state could not manage to build a hen house. They have no conception of hiw tge building sector operates

Least over there it was above inflation. Irish property funds are well ahead of the game by front-loading new-build prices, which is why you see so many central Dublin apartments with rent of €4-5k/month.

What exact percentage of funding did the religious orders provide for our schools and hospitals? "Sigificant funds" is a very dubious claim.

The state was massively poorer in the 1920s→1980s compared to now, I don't think thats really up for debate. There was no yearly surplus of billions of euros like we have now. We ran budget deficits, and had massive unemployment and emmigration for the vast majority of the first 70 years of independence. We were the poorest country per capita in Western Europe for large parts of that. We were an economic basket case. Yet still built thousands of social housing units regularly.

The idea that the state now cannot afford to build social housing, because religious orders are paying less towards our schools and hospitals, is just nowhere near factual. Especially given the fact we currently have a yearly surplus of money, a lack of money is empirically not the problem here.

"The state cannot no longer directly manage building projects." - there is no inherent genetic problem with Irish people in the year 2024 that means our country can't manage building projects. We did it in the past, when corruption and inefficiency ran rife, so theres absoutely no logical reason why we can't do so now. The reason we don't is ideological - because FG have done their best to gut state spending on construction over the last 13 years.

Just because our current government has proven utterly inable to directly manage building projects does not mean every Irish government ever will be.

I'll also ask you the same question I asked Dav010, which rather tellingly seems to have prompted him to disappear. If you don't believe the state should be building large numbers of social housing then what exactly is your proposed alternative solution? Do you think the state should continue the FG policy of the last decade, and continue/increase its spending on HAP and leasing social housing instead, from the billions of euros its already spending? Do you think thats working well currently, and providing value for money to the Irish tax payer?