Friday 24 November 2017

Paying the price for costly and outdated regulations

Ronan Lyons is assistant professor of economics at Trinity College and author of the Daft.ie Reports (Stock picture)
Ronan Lyons is assistant professor of economics at Trinity College and author of the Daft.ie Reports (Stock picture)

Ronan Lyons

Last week's column discussed some recent history, in particular the regulatory backlash to the building boom that took place between 2000 and 2007. The main point was that many believe that the volume and quality of building was a result of the lack of regulation, rather than the wrong regulations (in particular tax incentives).

If you believe this, you are more likely to believe that the answer lies in lots more regulation, rather than simply enforcing the regulations that were there all along (and removing the tax incentives that distorted the market).

This is what most local authorities believe and we have seen the implications in a raft of new requirements for building, especially when it comes to apartments. Almost all of these new regulations come from good intentions, like the requirement in Dun Laoghaire-Rathdown that all new homes are passive - they produce at least as much energy as they consume - or the requirement for all apartments to be fully accessible to those with limited mobility.

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