Rory Hearne: Budget happened in a parallel universe with no housing crisis 

Even the new vacant property tax is tokenistic, argues Rory Hearne
Rory Hearne: Budget happened in a parallel universe with no housing crisis 

For housing, the Budget was like something from a parallel universe. It had no new major action, ideas or additional investment in housing. Picture: PA

Does the Government still not understand the scale of the housing and homelessness disaster across the country? Why is it unwilling to take the visionary and bold action necessary to solve it? It is heartbreaking to see the ever-worsening housing situations people are experiencing; families evicted, children going into emergency accommodation, young people emigrating, vulnerable young people leaving state care into homelessness.

For housing, the Budget was like something from a parallel universe where no such emergency exists. It had no new major action, ideas or additional investment in housing. The Government is stuck in a half-way house, making tentative steps to get back into building social and affordable housing, yet still focused on ‘making the market work’, with developer subsidies (help-to-buy), tax breaks left in place for investor funds, and stubbornly refusing to freeze rents or banning evictions.

Even welcome policy initiatives, such as the new vacant property tax, are more tokenistic than seriously aiming to impact the market.

Another vital new policy, cost rental housing, affordable public housing for those on higher incomes, is being delivered in insufficient numbers to meet the housing need (resulting from a lost decade of failed policies). Just 234 cost rental homes have been delivered so far. Meanwhile, in the first half of this year, local authorities built just 647 new social homes, Approved housing bodies built 820. At that rate the Government will miss its new build social housing targets by a long shot.

In my new book Gaffs, Why No One Can Get a House, and What We Can Do About It, I show housing policy is still overly reliant on a private market that perpetually fails to deliver affordable homes. There are sites with full planning permission for 80,000 homes held by developers and investors but they are not being built on. Attempts by local authorities to get developers to build such schemes are getting no response. Local authorities and approved housing bodies
are worried that  their main source of new social housing  (‘turn-key’ housing) where they buy schemes from developers, will reduce with rising market uncertainty. There are also 188,000 homes left vacant and derelict (almost six years of housing supply). 

This is how the market ‘works. Even in an unprecedented housing crisis it acts irrationally and illogically. Land with planning permission left unbuilt, housing left vacant and derelict, because private actors are do not have the interest, capacity, or financial penalty to turn their ’assets’ into homes. The market cannot be relied upon to deliver the fundamental human need of homes.

The Budget included a €500 tax rebate for renters. While welcome, it will cover less than a third of one month’s rent (national average rent €1,460), or a quarter of a month’s rent in Dublin. And a third of all renters in the private rental sector (recipients of HAP and RAS) won't get the tax rebate. Questioned about the 3,200 children homeless with their families, the Tánaiste Leo Varadkar said, “everyone understands that homelessness is a lot more complex than just building houses or money. There are lots of other factors at play.” 

Evictions by private landlords and the lack of social and affordable housing are the primary cause of homelessness. These attempts to deflect the blame of homelessness onto the families, individuals and children homeless, is not only shameful, it also underpins their main policy response, emergency accommodation, not the actual solution to homelessness; homes. 

As an emergency response to unprecedented homelessness, there should be a three-year moratorium on evictions. Landlords could still sell up, but the tenant remains in situ. Landlords could leave the market without the catastrophic result of homelessness and lost tenancies. That would be a measure with real impact and give renters a sense of security, that if their landlord sells, they will not be forced into homelessness.

The Government allocated €2bn this year into a rainy day fund, and a further €4bn next year. Yet for Generation Rent and all those locked out of a gaff of their own (there are 450,000 adults living at home with their parent) they are drowning right now. Their futures, are being lost. 

That €2bn should be invested in building an additional 8,000 social and affordable homes annually. Local authorities and housing associations need resources, capacity and land to build, compulsory purchase orders, and retrofit homes on the scale needed. It's also essential to provide homes in rural Ireland including smaller cities, towns and villages overlooked by the private market and the Land Development Agency. There is hope that we can end this crisis, it is about ramping up the positive policies and taking bold necessary action such as setting up a state construction company to guarantee the delivery of homes. 

Using the Ó Cualann co-housing model, a €500m investment using public land could build 2,000 affordable homes for sale in a year (including modular). The income from the sale of those houses would enable construction of another 2,000 each year on a rolling basis. It's how private developers work. Why isn’t the state funding more not-for-profit housing companies, and using a state construction company to do this?

Rory Hearne’s new book 'Gaffs: Why No One Can Get a House, And What We Can Do About It', is published by Harper Collins Ireland

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