Wednesday 11 December 2019

Paul Melia: Why housing must be main election issue

How the parties compare on housing
How the parties compare on housing
Paul Melia

Paul Melia

Housing will be among the main priorities of the incoming government, but its hands will be somewhat tied in matching ambition with results, at least in the short-term.

The housing crisis goes right across all sectors of society - from the homeless and those on council lists, to renters, first-time buyers hamstrung by tough lending rules and families seeking to trade up.

The common problem is the lack of houses coming on stream - construction has effectively stalled from the heady days of 2006 when more than 93,000 units were built. Last year, the number stood at just over 12,500.

Building a house or apartment doesn't happen overnight, and all the money in the world won't provide a quick solution. Between securing a site and planning permission, hiring workers and building, it can take up to two years for a plan to become reality.

That means when new units do come on stream, they are snapped up. The lack of supply means a new home is around €40,000 more expensive today than in 2014.

If all parties came together, the housing crisis would be sorted sooner rather than later. While politics doesn't work like that, there's no reason why the next Government cannot borrow or steal the best ideas from their opposition.

One interesting proposal is to tap into pension funds, which would deliver the homes and be repaid over time. There would be a steady return over decades. In an uncertain world, that could prove attractive.

The Royal Institute of the Architects of Ireland proposes using existing vacant space in towns and cities, with financial incentives to develop 'living above the shop'. This could be a valuable source of accommodation for workers.

There are also proposals to link rental hikes to inflation and to develop more affordable rental accommodation. But rent controls may discourage private funders from investing. Some measures have already been taken to address the problem, including tackling ghost estates, bringing vacant council housing back into use and the introduction of a rebate on development levies.

But it would be worth considering obliging all new homes to have easily-converted attics to provide more living accommodation, negating the need to find a new home. The home renovation tax break could also be extended indefinitely to house extensions.

But parties promising a quick win are not being honest. It will take longer than a few months in office to solve a crisis that has been years in the making.

Irish Independent

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