Editorials

The Irish Times view on the housing crisis: delivery must be the focus

The real crux of this is not how much should be spent – even if that is debated – it is about how progress can be achieved

Irish Architecture Foundation Director Nathalie Weadick and The Housing Agency CEO Bob Jordan at the opening of ‘Housing Unlocked’, an open call for ideas to solve housing issues in Ireland’s cities, towns and villages. Photograph: Mark Stedman

Fri Feb 18 2022 - 00:02

There was no good news in the latest house price inflation figures, with a rise of 14.4 per cent in annual prices worsening the affordability crisis in key parts of the market. There are signs that housing supply is set to rise but, inevitably, this process will be gradual and big questions remain about the pace at which improvement can be delivered.

The halt in building activity for a time during the pandemic and the difficulty in operating the normal sales process have had an impact which is hard to disentangle when looking at the data. The same is evident in many other markets internationally.Trends later in the year, when much of this distortion will have washed through, will be worth watching. Most observers expect prices to keep rising, but at a slower pace, with demand set to remain strong.

While prices are now approaching their Celtic Tiger peak, there is no sign of the kind of dangerous build-up of household borrowing seen at that time. Central Bank lending rules – and household caution – have both played a role here. But the strong rise in prices in recent years and the lack of supply of more affordable properties, particularly in urban areas, have left many people effectively locked out of the market, with huge social and economic consequences. Record rent levels, meanwhile, are the other – related – side of the housing crisis.

There is no doubt that this will be a defining social and political issue for the rest of this Government’s term and beyond. Having published its housing plan, involving a commitment to spend some €4 billion a year, the Government’s job now is to deliver on it, particularly the key supply measures. Achieving this, with all the complexities involved and at a time when building costs are rising, will require a relentless focus.

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Sinn Féin, meanwhile, says that the additional funding being set aside is still not enough and that its policies will lead to a faster roll-out of social and affordable properties in particular. It is an area where the Opposition has got traction with voters, though whoever is in power will face many of the same obstacles.

Despite the political noise, there is now agreement across party lines that massive public resources need to be allocated to the housing crisis over the coming years.

The real crux of this is not how much should be spent – even if that is debated – it is about how progress can be achieved. It is about how to harness the limited resources of the State – including land as well as cash – the building sector and private sector funding to deliver something better. There is no magic solution, but progress can and must be made.

If the current Government does not succeed in this, then it knows that it will pay for it at the next general election.

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