Resolving the housing crisis: Failure has created a real opportunity

There are few areas where the market, that unquestionable force, has failed as dramatically as in housing. That failure is evident in the private, social, and rental sectors.

Unless a far more effective response can be found, that situation will be exacerbated by relentless urbanisation and the increasingly insecure and low-paid nature of much of today’s work. 

These realities are made all the more pressing by globalisation, automation, the growing impression that our economic recovery may not be as secure as we had hoped, and the dire prospect of a hard Brexit. 

There are many reasons to be pessimistic, but there is a real sense of possibility, too, if we take on boardthat old, irrefutable maxim — “only a fool can expect a different response if he keeps doing the same thing”.

The evidence of market failure is undeniable, though there are myriad reasons why. According to the Peter McVerry Trust, 7,472 people were homeless in March and 102,711 people were in mortgage arrears. 

Many more are unable to move, because of negative equity. Others are stuck on social housing waiting lists. Scores of thousands more are trapped in something like contemporary serfdom, chained to barely sustainable mortgages. 

They live their lives just one unforeseen twist of fate away from life-changing vulnerability. In an irony that underlines market dysfunction, the parents of some people who are struggling to buy a house are sitting on assets — their home — that have assumed a value beyond their wildest imaginings. 

Others, no matter how they try, are unable to save a deposit to buy a home, because they pay rents that consume a significant proportion of their income. 

In a process that facilitates today’s dangerous concentration of wealth, they face the prospect of being tenants all of their lives. The prominent role of vulture funds in the rental market is unlikely to make that situation any more humane.

Housing Minister Simon Coveney, outlining the Government’s response, recently gave details of how 50,000 homes will be built before 2021. 

Many of these developments will depend on public/private partnerships, as Fianna Fáil decided 20 years ago that the State should have no direct role in social housing. 

That was a disastrous decision, but the response of all governments since has also been inadequate.

Mr Coveney has said housing plans should not be ideological. If that is true, then he should consider the proposal made last week by the One Cork group of trade unionists, who said a municipal housing authority should be set up to accelerate social-housing builds. 

They suggested such an authority could deliver homes up to 20% cheaper than the private sector. That alone is reason enough to establish it. 

That it might also rejuvenate the practical patriotism that animates good public service, and possibly play a part in remaking our equally dysfunctional pensions regime, makes it more attractive. 

However, by far the greatest argument for a project like this is that it would show that government can actually deliver on real social needs, in a way that serves citizens rather than corporations. 

It may avert an Irish Trump, Farage, Le Pen, or Erdogan. In any event, it could hardly be less effective than today’s arrangements.

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