Monday 17 December 2018

The millennial superpower and the housing crisis

Photo: Stock
Photo: Stock
Niamh Horan

Niamh Horan

If the thundering movement to repeal the Eighth Amendment has taught us anything, it is that young people are mobilised, politically in tune and willing to exercise their vote when it matters.

Couple this with the news that millennial spending power will overtake Generation X within two years and our politicians have a big problem. They have a problem because now millennials have grown up and are a working, earning demographic - the vast majority of whom are living in the capital - and nothing concerns these young people more than housing. And, yet either through bad governance or sheer ignorance, our politicians have failed to address it.

Millennials are no longer the kids to be written off. Leading US research group Pew defines their age as between 22 and 37. And in Ireland, they are more than half-a million-strong army of voters.

By 2025, 75pc of the global workforce will be millennials. Much of the tax burden in Ireland's tax system falls squarely on their shoulders. Which makes it more notable that this is the same group of people who have said they feel they are not being listened to.

In a survey entitled 'Millennial Dialogue', which outlined their aspirations and concerns and looked at how these are affecting their politics, 73pc felt "the views of young people are largely ignored by most politicians".

And who could blame them?

The spiralling cost of their rent is at an all-time high, far surpassing boom time levels (it costs €3,000 more per year to rent a property than during the height of the Celtic Tiger), almost half a million over 18-year-olds are living with their parents, many are facing renting into their forties and house prices will continue to soar for the next two to three years - pricing most first-time buyers out of the market.

At first glance, last week's fiscal watchdog report seemed to assuage the Government from any embarrassment over continued inaction on the issue. It warned that - although the property crisis needs to be addressed - a housing boom could tip us towards an overheated economy.

But it does not excuse the complete failure to prevent this crisis to date (as far back as 2012, developers warned both Nama and the Department of Finance that this was coming down the tracks), and any further inaction would be detrimental - creating the real potential of another crash.

The problem is two-fold.

Not only is the Government failing to address supply, but also the kind of housing millennials need and are crying out for.

Solo living has increased considerably in the last 30 years, with people getting married later and divorce becoming more common. The number of young adults living alone has risen rapidly since the 1950s - their number one reason is now cited as "independence" rather than settling down with a family - and a third of EU households are now composed of a single person, while one-in-four of all households consist of couples without children. The trend is only going one way.

Millennials do not want family-sized homes with a back garden on the commuter belt. The days of telling people to move out of the city are dead. It's affordable apartment living, near main transport hubs, accessible to the city centre, their social lives and their work that is in demand - and for that reason building up is the economic 'no-brainer' Ireland's politicians have yet to get their head around.

Indeed, one of the biggest frustrations of millennials is a complete lack of will and joined-up thinking by planning authorities to enable it. It's causing anger among young adults, who are struggling to find affordable places to live and who know the cause of the shortage of housing is 100pc political. And these are the people who will be voting en-masse in the next election.

The State's fiscal watchdog has already provided an economic solution to the risk of overheating the market. Although it would arguably be better to reduce our 13.5pc VAT rate on property building in the capital for a fixed time period (it's 0pc in the UK and Northern Ireland but our Government seems too concerned with optics to introduce the initiative - lest they be seen to benefit developers). Nevertheless, the fiscal body has suggested that any increase in tax revenues from additional house building could be put into a buffer fund that would protect against future shocks. Another pathway to the solution could lie in persuading the Government to listen to the concerns of a generation of millennials, via the citizens' assembly.

The assembly has proved to be an invaluable resource in exercising democracy, placing the citizens and their everyday reality at the heart of politics. Its recommendations brought about powerful change on the Eighth Amendment, although largely under the radar for its work in other areas, it has done the same with four other key issues: aging, climate change, the way in which referendums are being held and the issue of fixed-term parliaments. It is delivering its final reports in the next two weeks and will effectively be freed up.

Only the Oireachtas has the power to harness this powerful entity rather than allowing it to unwind. They can direct the members where to turn their attention to next and, if the housing crisis doesn't tick the box of a pressing social issue of epidemic proportions, then I don't know what does.

It would take the power back from faceless planners, out-of-touch lawmakers and vested interests and for the first time allow younger generations to have a real say in the future of where they live. It would shape an environment to accommodate everyone's needs - a vibrant capital city where we all want and can afford to live. The issue is too important to leave to chance.

The Government sat up and took notice before when the anger and experiences of voters were channelled upwards through the group. Perhaps they will do so again. If not, and the problem isn't addressed as a matter of urgency, millennial voters can make their feelings known at the ballot box. And we all know the power that rests in their hands.

Sunday Independent

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