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Coveney must show leadership and tax vacant homes as first step toward easing housing crisis


Minister for Housing, Planning and Local Government Simon Coveney. Photo: Steve Humphreys

Minister for Housing, Planning and Local Government Simon Coveney. Photo: Steve Humphreys

Minister for Housing, Planning and Local Government Simon Coveney. Photo: Steve Humphreys

Ireland's ongoing housing crisis is not only a social emergency, but a threat to the country's economic prospects in the face of major global change.

The results from the Ireland Thinks poll showing that 62pc of the public would support the introduction of a tax on vacant homes signals that there is clear demand for the Government to take forceful measures to get the housing situation under control.

As is well known, the roots of the current housing crisis lie in the collapse of private housing construction following the property crash.

What is perhaps less well known is that the huge shortage in social housing availability was also a result of the crash in the private sector, as the Fianna Fáil-led government made a policy choice to provide social housing through the rent supplement scheme, and through Part V obligations on developers, while effectively abandoning social housing construction by local authorities themselves.

Following the strong economic rebound from 2012, and coupled with a fast-growing population, the lack of new private housing construction led to rapidly increasing rents and, combined with the State's dependence on the private sector through rent supplement and a lack of social housing supply, created the housing crisis we are now mired in.

With more than 1,200 families now in emergency accommodation, there is clearly a need for stronger measures than have thus far been deployed.

The previous housing minister, Alan Kelly, launched the €4bn Social Housing Strategy to dramatically scale up the delivery of social housing by local authorities, brought more than 5,000 vacant social housing units back into circulation, introduced a vacant site levy to tackle the hoarding of land suitable for residential housing, increased funding for tackling homelessness, brought in incentives to scale up the construction of private housing, sought to protect those in the private rented sector from rapidly rising rents by improving tenants' rights and implemented many other measures.

While all of these were important and most aimed at increasing the supply of both public and private housing, many will take time to deliver. There is clearly still a need for more to be done over a shorter timeframe.

Given the long time-lag for increasing the supply of housing, the most effective way of calming rapidly increasing rents in the short term is to bring existing vacant stock back into use. The results from the census show that, once holiday homes are stripped out we have a 9.7pc vacancy rate, or 200,000 homes lying empty across the State.

In Dublin, where the crisis is most acute, there are 20,000 vacant units alone. This is roughly twice the rate it should be and is simply unacceptable in the midst of the current housing and homelessness crisis.

From the results of this poll, the public has clearly grasped, long before the current Fine Gael-led Government has, the need for stronger and more urgent action by way of incentivising the return of vacant private housing stock to circulation.

While tax relief for housing renovation is a part of the solution and was brought in by the Fine Gael-Labour government, there is clearly a need for the current administration to grab the bull by the horns and urgently get these private units back into circulation. A charge on houses that have been vacant for more than one year, as proposed by the Peter McVerry Trust, is clearly a sound and logical proposal that will be in the national interest.

In my experience of working on this issue within government, I was sometimes shocked at the indifference shown by officials within other government departments to the plight of those at risk of homelessness, or those suffering from rapidly increasing rents.

It should not be lost on anyone that the housing crisis also poses a threat to Ireland's economic prospects in the face of Brexit.

The downsides of Brexit are well known, but the housing crisis poses a threat to any potential which Ireland has to take advantage of any upsides, such as commercial relocation from London to Dublin or any other city.

As we compete for these jobs with Paris and Frankfurt, I have no doubt that potential investors are concerned about the residential housing shortage and rising rents, and want to see effective Government action to get the situation under control as soon as possible.

Our competitors in Paris and Frankfurt will not be slow to point out the problems we have in this area. By incentivising owners to get their properties back in circulation, a tax on vacant homes would certainly help in this regard too.

The Irish public are clearly already supportive of the idea and want to see the housing crisis resolved. Housing Minister Simon Coveney knows the situation and is due to contest a leadership election within his own party shortly, hoping to become the next Taoiseach and leader of the country.

He could show some real national leadership on this issue by supporting a vacant house tax and doing what is truly in the national interest.

Cónán Ó Broin was a special adviser in the Department of Housing during the previous government and is a member of the Labour Party

Irish Independent