There’s an air of Nero fiddling while Rome burned about the Government’s approach to housing.
Figures from property website Daft.ie on Monday showed that prices are now rising faster than at any time in the past decade. Asking prices are 12.3 per cent higher than at this time last year.
This at a time when, according to the Central Statistics Office, inflation is running at an annualised rate of 1.7 per cent and hourly pay is 5.6 per cent ahead.
Last year, when inflation was higher, property prices were rising by just over half the current rate – 6.7 per cent.
In between we’ve had an election contested around promises on housing, a continuous drip-feed of policy announcements that seem designed more to see how they sit with various stakeholders than with any sense of cohesion and, recently, a confession that current housing targets are little more than a fiction.
Ronan Lyons, associate professor of economics at Trinity College and author of the Daft.ie report, notes that the last time prices were rising this fast, the Central Bank stepped in with mortgage limits.
His assessment of the problem: the market is “starved of supply”.
Lyons’ comments come a day after veteran builder Sean Mulryan said that tax breaks for development were not the answer to the housing crisis. If not, what is?
Serviced, zoned land, says Mulryan. “I don’t think tax breaks are the answer. I think the answer is to get the land zoned, get the infrastructure in and let’s get on with it,” he told the Business Post in an interview, adding there were too many people involved, too many local authorities going in different directions.
The Government is promising an update to its housing policy. You can expect, as with rent controls, that Minister James Browne will seek to present a package of measures to keep builders sweet and house-hunters hopeful.
Naturally, well-leaked talk of further incentives for developers as part of that package has only encouraged builders to sit back to see whether there will be better terms available to them in a few months – applying a brake to already slowing progress.
It’s long past time we stopped playing politics with housing.
What is needed is not new perks or vague statements of intention but consistency of policy so that everyone knows what to expect and when, can arrange funding on the back of it and get on with delivery.
