but supply wasnt an issue until the early 2000s when the market functioned properly. as i said some of the issues are in housing policy and some are in other national and international areas aided and abetted by significant lack of insight or forward planning by govt.
Wages exploded around 1998 to 2001. Celtic Tiger. Tech bubble etc. then in 2001 US slowed down. 9/11 happened. There was a sense US economy could fall over. Confidence was shaken. Money got pumped in. Interest rates lowered. That drove a lot of what was to unfold in 2008
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maybe, but people didnt generally have holiday homes, investment properlies (axcepting gardai, teachers and politicians) and property was generally seen as a forever home rather than a get rich scheme. the seeds that were planted at the turn of the century are now coming to fruition
Agreed on that.
Our whole economy is based on this.
Save enough money on deposits to get a deposit on a house. When you are far down the road on that sage again to move house or to buy a second house.
Our investments and savings culture is based around bank deposits and property (which made us a disaster at the times of the crash). And our tax system (rates and processes) and public policy and political policy are all geared towards funnelling money into deposits and then property. But that ultimately ends up rewarding those who can buy more than one house and punishing those who are for to afford one.
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There should be CGT on sale of homes. Itâs a gain. It should be taxed.
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but but but, my bigger house and island, i wont be able to afford them if i pay tax
- That isnât true. They take rent paid into account. Thatâs a complete myth.
Self employed people is a different story, it isnât teachers like you claimed.
Funds do pay tax, thatâs another myth.
- Varadkar makes statements. Saying that people borrow money for deposits is true, but of course stupid.
Itâs really irrelevant to policy.
- I havenât decided that but you have made statements thatâs the system is rigged.
Those measures were brought in in an attempt to he renter friendly. A direct result of those measures are those landlords leaving the market and the new pipeline of builds seizing up in recent months. âFundsâ ie our pensions will not develop property in a place with eviction bans.
- Current policies are flawed in that they too often are reactive to sensationalist headlines ie the eviction bans
Policies put in place a few years ago to boost supply were working with it ramping up. Much more could be done on it but all of this ideological stuff and âsystem is riggedâ stuff is emotive nonsense.
In terms of the system being âriggedâ, what the system does do is reward incumbents. Even well meaning regulations end up doing that, eg RPZs.
Thereâs no party seriously looking at challenging that (although OâBrienâs recent reforms are a decent start) as it is in none of their political interests.
Also tax individualisation
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But from around 1999 on, housing construction boomed, did it not? So increased supply was coming on stream all the time.
What were these policy interventions? I remember hearing about the Bacon report but Iâm fucked if I remember the details.
Rent was affordable up to, I donât know, maybe 10 years ago? Then it seemed to skyrocket.
Surely the obvious conclusion is that when the crash happened, construction stopped, but population kept increasing. But the market could not provide the solutions. The state refused to.
A few random observations on housing.
There is probably enough housing stock in the country for the population. Much of it is in the wrong place (outside Dublin) and in the wrong hands (elderly people should be incentivised to trade down and free up their 3/4/5 bed houses for families).
Much of the increased cost of building a house is down to higher standards. 50 years ago a new build in an estate had single glazed windows, no insulation, no fitted kitchen, no Island, no fitted wardrobes and no solar panels. These extras cost a lot of money.
Ireland is a desirable place to live. It wasnât fifty years ago. We have a lot of inward migration and people born here generally want to stay here. Life expectancy is the highest in Europe, we have a demographic bubble.
It is only a decade since we had ghost estates. Some of them in quite desirable locations. There was an estate there at Fingal cemetery where the tarpaulins were flapping in the wind until 2015. The CSO released a (subsequently discredited) statistic in 2011 that there were 300,000 empty homes in the State. Who would commit capital to building when there were already so many empty homes in the state.
There are only two Irish banks and they canât and wonât commit large parts of their loan books to property again because of what happened the last time they did. So if money is needed to build house it will have to come from abroad. Money wonât be committed to Irish property from abroad unless it is guaranteed to make a profit. You can call them vultures all you want but unless these financiers are getting a return on their money why would they come to Ireland. Moreover the native Irish developer class got their balls handed to them after the crash and only a few are still in the game.
The traditional builder lad throwing up two or three houses here and there is gone. With the standards gone up he canât make it pay.
Young fellas donât want to be tradesmen any more. Thereâs much easier ways to make a living and any young lad with his head screwed on would prefer to be doing a college course somewhere.
The State lost the ability to deliver quality housing in the 50s. Most of what it delivered after was a disaster and it hasnât the infrastructure or skills to build any more. Do we really want the housing equivalent of the HSE?
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Was that not almost a deliberate choice though?
I think the rest of your post is well observed.
That all sounds on the money but what is the solution though. I donât think those of us over a certain age who own our own house realise properly what an unmitigated disaster the whole thing is for the younger generation. Now maybe the solution is long term renting and they can never own their own homes but I would imagine countries that have that culture are set up for it in terms of effective rent controls and long term leases etc. Weâre neither one or the other.
Ridiculously simplistic solution alert but apart from not trusting the public sector to get it done could the government build a shit load of houses and sell them/rent them to people at absolute cost price? ie making no profit. This would then distort the market and bring prices and rents down elsewhere. Do a big raffle for the houses like they used do in the mansion House for council houses.
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Jaysus I wouldnât fancy being someone who is caught up in this nightmare.
They were some way on the solution;
- national zoning and policy: remove local elements from the equation. They claim it is âdemocracyâ but it is anything but, everywhere has locals with vested interests. The interests not catered for are people who actually need housing.
National policy tried this but local NIMBYs ratcheted it up a degree by abusing the court system.
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heavily tax inheritances on homes. Do not allow for delays on probate- too many houses are sitting idle for an age
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use our advantage that we are a country that was too poor to consider apartments for decades. Get the right people in the right homes. Build loads of 1 beds (lots of that been done). Incentivise the elderly to leave their big nests into those apartments
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reduce standards on garden sizes etc., most people donât care about them
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Stateâs role: big ticket infrastructure projects that support density, funding and visa programmes to bring in skilled labour
There categorically isnât.
This isnât correct either.
Ok glas.
We have far fewer units per head of population than the EU average. There are loads of examples of the state building good housing, as well as bad. I should think a lot has been learned from the bad developments, thereâs no reason the state shouldnât be building or or canât build loads of good quality housing.
Landlords selling is a valid reason for eviction in terms of flying when it comes to the RTB.
A lot of these cases are private landlords upping the rent or wanting to above the agreed acceptable levels and when challenged by the tenant they say they are selling.
Thereâs a lot of greed and jealousy amongst landlords in rural Ireland that is going unreported. I know someone living in a shoebox with no heating being evicted cos the landlord wants 300 more per month as his buddy up the road is 900 for a one bed.
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Keep em coming, shur itâs nearly springâŚ
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