The Irish Times view on the ESRI report on housing: Ireland should look at the UK’s experience

There are lessons to be learned from comparing the housing markets on these islands, but the points of difference are probably more illuminating than the similarities

Ireland’s housing crisis may be severe, but it is far from unique. Many developed nations are experiencing something similar ‚for much the same reasons.

This is particularly true when we look to our nearest neighbours: Northern Ireland, England, Scotland and Wales.

There are lessons to be learned from comparing the housing markets on these islands according to the Economic and Social Research Institute which has published the results of a study that does just that.

The points of difference are probably more illuminating than the similarities.

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One difference is the impact of the 2007 global financial crisis which was felt much more keenly by the housing market here than in the UK, due to the amount of property lending by Irish banks. Its legacy is still being felt here in the form of constraints on the availability of finance for house buyers and the construction sector generally.

However, the problem of the availability of finance is common to all five markets, albeit to a lesser extent in the UK. There is also a common solution: greater government investment in housing, something which has been in decline in all five markets since the 1970s, at least until recently.

There are two areas in which Ireland’s problems are unique and to a certain extent home-grown. The first is planning. The UK shares with us the same basic planning model, with a great deal of responsibility for implementing national strategies devolved to local authorities. This should come as no surprise given our common history.

All might gain from less devolution of planning, - or at least better guidelines - but Ireland could also benefit from reducing the need to allow third parties participate in the planning process to the extent to which they do. Here, according to the ESRI, Ireland appears to be an outlier even across the broader European housing market. The Planning and Development Bill currently going through the Oireachtas – which limits grounds for judicial reviews among other measures – should help in this regard.

The second area is the role that speculation in land prices plays in driving up the costs of housing here. Better data on land prices is needed along with better regulation in the provision of land for housing – similar to the system in the UK – which could help lower the costs of building land.

The solution to Ireland’s housing crisis does not lie in simply copying policies and practices from Northern Ireland or Britain. If anything, we have done too much of that already and we all find ourselves in the much the same boat. But Ireland can learn something from looking at the successes and mistakes other countries have made in key areas such as planning and land management.