New foundations needed to build a better future for housing
IN normal circumstances, we would be naturally suspicious of calls for more construction or credit in the residential property market. In the past, a combination of increased supply of houses and cheap credit created a concoction that blew the Irish economy to smithereens.
These are not normal circumstances.
When the property market collapsed in 2007 the supply of new properties halted. The number of new planning permissions being sought stopped as developers found it impossible to secure financing. Those thinking of buying found that the mortgage market had dried up. In addition, up-front development taxes put a barrier in the way to any commencements, even the ones that may have made market sense.