Paul Hosford: Housing is still a huge issue for the new Government to tackle

Over a quarter of voters told an exit poll in February that their key concern when casting their ballot was housing.
Paul Hosford: Housing is still a huge issue for the new Government to tackle
Picture: Getty
Picture: Getty

Over a quarter of voters told an exit poll in February that their key concern when casting their ballot was housing.

In the days before Covid-19, the issue vexed the previous government and the last housing minister Eoghan Murphy was such a lightning rod for criticism that he became synonymous with Fine Gael's poor election, to the point where Fianna Fáil pushed hard in coalition talks to be given the housing brief.

The man trusted with the role is Darragh O'Brien, who was the party's housing spokesman in the previous Dáil. Sources within the party say he made no secret of his desire and willingness to take on one of the most demanding roles in government. But as the focus of the public returns to the non-Covid issues facing them, Mr O'Brien faces a number of challenges.

He has made strong noises already, saying that "there’s a whole lot of people who are stuck in a rip-off rental trap" and pledging to build an affordable purchase scheme.

But in the short-term, Mr O'Brien will have to reckon with the damage Covid-19 has done to the finances and the housing sector's core stability. He has asked the Attorney General to assess the legality of extending the ban on evictions put in place during the pandemic.

But a further issue awaits when this ban expires and deferred rents become due. If people cannot pay, an evictions crisis looms. If landlords are asked to swallow some of that loss, a massive contingent of semi-professional or "accidental" landlords could leave the system, which would cause a further imbalance in the market.

"There are short term, very urgent challenges because of Covid and there's structural issues that have been building up," says Professor Michelle Norris of the School of Public Policy at UCD.

Professor Norris believes the new Housing Minister could have a quick win in homelessness. She says increased funding to the Housing First plan would allow local authorities purchase homes for homeless people at a time when the need to cut the reliance on crowded hostels has never been greater.

"Dublin City Council has moved people to hotels and one-bedroom apartments to allow for social distancing and hostels are open 24 hours, meaning people don't have to spend all day roaming the streets, which is enormously positive.

"But if the tourist industry improves and the private rental sector improves, that could be an issue.

"One way to get a quick win would be to up the provision for Housing First to buy small units for homeless people."

Dr Rory Hearne, author of the recent book 'Housing Shock', believes Ireland's housing policy must change.

"There has to be a new plan - the Rebuilding Ireland plan has failed. The core of that plan has to be ending homelessness - a plan that sets out how we make housing affordable is needed."

Minister O'Brien has pinpointed affordability as the key issue in the housing market. This week, he said affordable homes will be built on state-owned land “where the State will subsume the cost of that land, so you would be looking at house prices in the region of (€)160(000), 180 to 230, 250 on a shared equity base”.

“It’s been done before very successfully actually in Ireland, even in the 2000s when 16,000 families got their homes through affordable purchase, and that will be one mode of it and it’s to give hope to that generation who feel like, ‘When am I ever going to be able to get a home?’”

However, that shared equity scheme would see developers, under two schemes put forward by their representatives, pay the full market cost of the house, with homeowners owing the State up to 15% of the home's value either by paying back the amount through a loan or when the house is sold.

Developers have argued that while the cost of building remains high, they have to charge at certain levels.

Dr Hearne said this is evidence that the State should build en masse on public lands.

"The State tries to incentivise private building on public land. So the land is a subsidy and the housing built on it then becomes unaffordable. This is proven not to be effective. Developers and financiers can pull out, lots of things can change. The State should be using state lands to build. We cannot plan and build communities in private."

Sinn Féin's Eoin O'Broin said people were "in desperate need of social and affordable housing" but said that the Programme for Government was a "continuation of the failed Fine Gael policy".

"There's no mention of tackling high rents or in security of tenure for private renters."

Fiona Cormican, the New Business Director with Clúid Housing said social housing can help to solve the crisis, but faces issues with its own financing. In 2017, the CSO reclassified the 14 largest approved housing bodies (AHBs) as governmental spending, meaning their borrowing is on the Government balance sheet, something AHBs have fought to reverse.

"We have to reverse classification - can't have social housing in competition with roads, hospitals. There's a lot of cheap money out there that will fund housing - if we want to deliver at scale, we need to borrow that money."

Most people within the housing industry agree the Housing Minister faces a challenge in establishing a long-term rental culture.

"I don't think we should be pushing people down the road of home ownership if they may run into trouble," says Ms Cormican. "Give them secure, long-term tenancies."

She adds, however, that for that to happen, the qualification levels for social housing must become graduated.

"We have to look at the limits on income. A euro above the scale cuts you off, but a euro under you qualify, that makes no sense.

"You look at the frontline workers who we have lauded - they're all the people who could avail of affordable rental."

Mr O'Brien will also face issues when the legislation around the Land Development Agency is published. Some say that without meaningful powers to purchase land and compel state agencies to give up plum sites, it will serve only the private market.

Dr Hearne said its current structure makes it a "speculative agency" and Mr O'Broin saying the proposed structure would be "a disaster".

Professor Norris, who is a member of the interim LDA board, says its intervention is "hugely important".

Mr O'Brien has shown a willingness to work to improve the housing sector, but Dr Rory Hearne says it will come down to one thing - delivery.

"I think Mr O'Brien is committed to making a change, but the policy is the question."

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