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Sinn Féin’s grand plan for housing: Will it work?

A bonfire of Government housing support schemes is a step into the unknown - even if the promise is for a better future

The parts of Sinn Féin’s housing plan that we have seen are detailed. Photograph: iStock
The parts of Sinn Féin’s housing plan that we have seen are detailed. Photograph: iStock
Jack Horgan-Jones's picture
Jack Horgan-Jones
Fri Aug 09 2024 - 06:00

Next month, Sinn Féin will launch a new housing plan. Part of it is a detailed strategy to overhaul the private housing development sector, with a promise of 175,000 private homes over five years.

Sinn Féin contends that by reducing risks at the start of the process focused around land, zoning, planning and debt, it would be able to bring down the cost of housing to buyers, encourage building, increase supply and ditch Government schemes that enable purchase for some but are poorly designed and inflate the market.

The main features of the Sinn Féin plan are:

  • Extra resources for the courts and planning authorities – including 500 extra workers for local authorities, another 50 staff for An Bord Pleanála, and three extra planning and environmental judges;
  • Statutory timelines for all stages of the planning process for residential developments, including pre-planning, further information, An Bord Pleanála appeal and judicial review, with different timelines depending on the scale of a development;
  • Developers would face new “use it or lose it” rules for planning permissions – with local authorities empowered to revoke existing planning permissions, or make the continuance of a planning permission contingent on commencement or completion of development milestones;
  • Local authorities would be given new powers on zoning that would allow them to remove zoning from dormant sites and transfer it to a different project in the same area, subject to planning;
  • The Compulsory Purchase Order system would be overhauled, with landowners of dormant sites threatened with a purchase at “existing use” value – almost always lower than the price achieved under current CPO rules;
  • Existing bodies would offer loans or finance infrastructure much lower than mainstream commercial lending rates to smaller developers, while Sinn Féin would curtail the current Government approach to development fee waivers, targeting it at smaller builders.

Eoin Ó Broin says he would introduce a new scheme for compact development sites that would see developers engage with local authorities before purchasing a scheme, and strike an agreement whereby the county or city council would masterplan a development and recourse to An Bord Pleanála would be dropped. In return, developers would be expected to pass on any reductions achieved in the development cost to the purchaser, calculated by an open-book examination of development costs – but preserving a profit margin.

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The State would offer multiyear agreements to developers of social housing, offering development finance up front to builders rather than purchasing units at the completion of construction, which Sinn Féin again says would bring down the final cost.

The party is pledging to end immediately or phase out a host of Government interventions – most notably, the Help to Buy scheme, which has become a centrepiece of Government housing policy.

Sinn Féin say they would immediately raise the loan-to-value threshold for Help to Buy from 70 per cent to 85 per cent – meaning people would need a bigger deposit on hand to avail of it. In 2026, it would begin the process of lowering the amount of tax that could be claimed back under the scheme – currently €30,000 – by €6,000, closing applications in December 2029 and with final drawdowns the following year.

It would guillotine a host of Darragh O’Brien’s array of schemes, which it says are needless developer subsidies: the Local Infrastructure Housing Activation Fund, the Sustainable Tenancies Affordable Rents programme, Croi Conaithe Cities and Project Tosaigh, while committing to honour but also renegotiate where possible existing contracts with developers.

Sinn Féin’s argument is that in gradually phasing out some supports, they will give their new schemes time to bed in, and crucially, bring down the cost of housing for all parties. But a bonfire of the schemes is also a step into the unknown – even if the promise is for a better future.

For voters, the crucial question is: will it work? Unfortunately, like many forms of policymaking, housing is an opaque space. A policy might not have an impact for years after it’s put in place – and then it might not be the desired outcome, or it might be hard to measure.

On the one hand, Sinn Féin are focused on trying to reduce risk in some areas – particularly at the start of the process – but that inevitably involves the State assuming more risk; it also plans aggressive moves against those not using land – politically popular, but also fraught with legal risks. The plan envisages effectively extending the State’s borrowing power to smaller developers to bring down the cost of finance – the Government will doubtlessly raise State aid concerns.

The parts of Sinn Féin’s housing plan we have seen – affordable housing last week, and this week, the private residential sector – are detailed, typical of Ó Broin. The reality, however, is that writing the plan is the easy part – making it a reality takes no shortage of political skill, and luck.

But before any of that, it requires the winning of an election. Game on.