While the Government may be exhibiting a renewed and rather Trumpian sense of urgency when it comes to its plans for the delivery of housing, the chance of supply meeting demand in the short to medium term continues to be slim.
Having fallen hopelessly short in 2024 of both its stated target of 33,450 new homes and the more fanciful Deutsche Bank estimate of 40,000 touted by then housing minister Darragh O’Brien, then taoiseach Simon Harris and then tánaiste Micheál Martin during the general election campaign, the newly recycled Coalition is back throwing plans and promises at the proverbial wall in the hope that some of them will stick.
From the billions of additional euro being pledged for social housing, to the talk of abolishing rent-pressure zones and bringing back tax breaks for property developers and investors, it seems that everything and anything is now down for consideration.
We’ve been here before, and that’s why we need to be careful not to repeat the mistakes of the past, or to make new ones. One only has to look back to 2012 and to another piece of research from Deutsche Bank on Ireland’s housing market to see how badly things can go wrong. Looking at the demand for housing in our then-depressed economy, against an overhang of 289,451 houses (including almost 60,000 holiday homes), the bank’s researchers estimated then that it could have taken up to 43 years to fill them all. Were holiday homes to be factored into calculations, the glut could have taken up to 57 years to clear, the report concluded. Thankfully, the recovery in the economy which took hold from 2013 made a nonsense of Deutsche Bank’s gloomy projections.
While it’s unlikely the current Government will leave the housing market as spectacularly hungover as the Fianna Fáil-led coalition – in which Micheál Martin served as a minister – did in the late 2000s, it needs to be careful that whatever housing is being built now is of the right type, and in the right place.
The apparent preference of the Government, and for bodies such as the Land Development Agency (LDA) and approved housing bodies (AHBs) to build apartments rather than houses is understandable, given the speed at which greater numbers of units can be developed on a site.
Should the Government drop Rent Pressure Zones - and what would replace them?
But could the schemes now being rushed through in response to this crisis become examples of the “modern-day slums” that billionaire businessman Dermot Desmond warned about in a letter to then minister for housing Eoghan Murphy and other local politicians in 2020 when voicing his opposition to Cairn Homes’s plans to build apartments on the land it had acquired from RTÉ at its Montrose campus?
While Cairn Homes, Ireland’s largest home builder, understandably took issue with Mr Desmond’s suggestion that it might be proposing anything less than the highest-quality housing that it is known for, for the RTÉ site, his warning should not be ignored when it comes to the risks presented by the State’s rush to deliver thousands of apartments in response to the crisis.
In the same letter, Desmond noted how “Ballymun Towers North Dublin, built in the 1960s to accommodate a housing crisis” was “subsequently demolished and replaced by low-rise homes”.
[ Fianna Fáil interventions on housing prompt puzzlement in Fine GaelOpens in new window ]
The Irish people’s desire for a house that they can call their own is a long-standing one and will endure after this latest housing crisis is over.
And even though supply continues to fall far below demand, there are a growing number of schemes to choose from in Dublin, the commuter counties and beyond for those looking to buy a home.
Thankfully, for those prospective purchasers whose earnings push them above the income limit for the State’s Affordable Purchase Scheme, a good number of these homes are priced below the €500,000 Help-to-Buy threshold. A selection of these developments is included in this week’s Irish Times coverage of new homes.
