The Housing Crisis

According to the Government the aim of Irish housing policy is “to enable every household to have available an affordable dwelling of good quality, suited to its needs, in a good environment, and, as far as possible, at the tenure of its choice”. Despite these noble aspirations There are still many families  in Ireland homeless, or living in poor accommodation,  Ireland is not unique in having these problems. Throughout the world people live in slums and sub-standard accommodation. While we cannot solve the worldwide problem of homelessness, we can achieve those noble aspirations in Ireland.

A house is for some a necessity (a place to live) or a means of providing a rent free home and economic security for their old age. However for many others a house is an investment opportunity. The government  (committed to capitalism) would prefer if instead of you buying a house to live in (accumulating wealth and passing it  on down  to your family), that you would rent a house from their friends and financial backers, (so that they can accumulate wealth and pass it on to their families). Financial institutions would also prefer if you rent a house, after all if they give you a mortgage (a loan) to buy a house, they get a return (interest) for perhaps 30 years, whereas if they invest in the property market and rent the property  to you it provides a permanent return on their investment.

The Government could solve the crisis by declaring a ”Housing Emergency” allowing them to compulsorily purchase  apartments and houses which are currently vacant, and renting these at an affordable rent to those homeless and those on the housing waiting list. However this is not going to happen because;

  1. Existing homes would be reduced in value  and this could result in a rise in the number of homes in negative equity which could in turn impair the balance sheets of the Banks. (The European Central Bank (ECB) would then demand that the government once again protect the banks against any losses.)
  2. Rental incomes would be diminished affecting landlords possibly leading to a reduction in property investment and a reduction in building activity.
  3.  Pension funds invested in property being adversely effected so reducing their profits..

Solving the short term  supply problems;

The provision of social accommodation in mixed developments of owner occupied and “for rent” communities to provide for the citizens a place of residence, and to meet the basic human right to a place of shelter befitting a dignified human existence.

  • First the establishment of a single National Housing Authority, removing from local authorities the role of “landlord”, ending waiting lists and the interference by local Councillors in the allocation of local authority housing units.
  • Unoccupied homes should then be made available through local estate agents for rental at market rates in the same way as for other private rental properties. This would allow prospective tenants to seek out accommodation in the area of their choice.
  • Those needing rent support would be assisted by the Dept of Social Welfare in the normal way in accordance with their income and needs.

Solving the long term  supply problems;

There is no shortage of building land for the building of homes for the people. However land ownership is often fragmented, and available at the whim of the owner.  The State should compulsorily purchase these sites (at current use values),

  • Many existing area’s are no better than slums, and a breeding ground for social violence, crime, and unemployment. Its time to relocate the victims of these estates, and send in the bulldozers. A major regeneration of all slum areas, should begin immediately, those who resist regeneration must be swept aside. The combination of Public and Private partnership, and large tracts of land available within and on the outskirts of the cities, would make the process of regeneration affordable now. We have a growing population, we must plan for where these people are going to live.

The Economic and Social benefits;

  • Improving the attractiveness of Ireland as a location for Foreign Direct Investment (FDI)  would be enhanced as staff find accommodation affordable.
  • The easing of the upward pressure on wages, as workers constantly  try to keep up with rising house prices, and rental costs.
  • The burden on the State of domestic rent subsidies and income support for those on low incomes would be reduced.
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