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THIS MORNING BRINGS with it the news that the average rent in Ireland has passed the €1000-monthly mark for the first time since the Tiger-heights of early 2008.
It’s an inauspicious claim to fame. For most tenants in the country, particularly in Dublin, the Irish rental situation is a source of dread. People live in fear of a rent increase and of quite literally being unable to afford to live somewhere.
The issue of housing and homelessness dogged the last government almost from its inception. Yet for all the endless talk and political grandstanding the situation just seems to be getting worse and worse.
This morning’s news feels like a watershed. If the country is paying pre-crash rents but isn’t in a pre-crash state of affluence (at least not yet) then something doesn’t add up. So what can be done?
Supply and demand
“Look, the only way a landlord can turn away business is if the demand is there,” says economist with Daft Ronan Lyons.
He argues that while spiralling rents are a huge problem for current renters, a bigger picture needs to be looked at.
“The high level of prices is a sign that the system isn’t functioning properly,” he says.
We know at present that in the region of 30,000 or 40,000 new houses are needed each year to cope with our growing population. At present we’re getting about 15,000.
We need more building and we need it now. The solution isn’t to ban rents from moving up, the solution is to fix the market.
Easier said than done.
Various measures have been introduced. Two years ago legislation was introduced to prevent landlords from discriminating against people on rent supplements.
Last November, after months of speculation, a two-year rent freeze was brought to the table. On top of this, property owners are required to give longer notice to tenants of rental increases or eviction, while any such increase would have to be justified by the landlord in question. However, it should be pointed out that the two-year timescale was simply an extension of the one-year rule that had already been in place. So, not that revolutionary then.
The rental freeze could be misconstrued as a blanket moratorium on raising rents. That isn’t the case (if it were, average rents couldn’t increase) – it simply means that rents can only be raised once every two years, while new leases are capped at ‘market value’.
As it often does, politics took a hand in the situation. Former environment minister Alan Kelly had long touted the fact that he wanted to link rental increases to inflation, a form of rent certainty. That was eventually nipped in the bud in favour of the rental freeze by finance minister Michael Noonan.
New government
But there’s a new government in town now. One built on not-entirely stable foundations with a major onus on it to do something about the problem.
A new rent certainty bill is to be brought before the Dáil today by Sinn Féin. Rent certainty is also something that household charity Threshold have been pushing for for a long time. This is understandable given it routinely deals with tenants who have been quite literally priced out of their homes by rent increases of 20% to 40%.
“The rent increases we’ve been seeing are not justifiable,” says Stephen Large of Threshold.
Fair enough, a landlord has to cover his costs and make a profit, but this is a situation that we’re seeing across the board, and not just in low-income households. And it’s spreading around the country.
The end result will be a society that for the vast majority of its citizens buying a house is simply not an option, and never will be, according to Large.
“That is not necessarily a bad thing – for too long renting has been denigrated as paying dead money, with home ownership seen as the only thing worth aspiring to at the expense of all other options,” he says. “Rethinking what it means to be a renter in Ireland should be first on the agenda.”
Lyons and Large disagree as to what immediate actions are warranted and effective, understandably given Daft looks at the market from a long-term viewpoint, while Threshold have to deal with the here and now of people in crisis.
“Freezing rent is appealing but it isn’t the answer. Neither is rent certainty,” says Lyons.
The problem isn’t rising rents – they’re a symptom. The problem is that we aren’t getting the solutions that we need.
“We need a coherent national strategy, a structured government-led response on the private rental sector,” says Large.
We have them for construction and home ownership, now we need a strategy for what part rentals are to play in the housing market. For too long private rentals have been the forgotten sector.
Both men are in agreement that immediate supply is the most pressing concern.
“At the same time we need to understand who the landlords are, who becomes a landlord, what can be done to make becoming one an attractive option,” says Large.
Most landlords own one property or are renting a property almost by accident – via inheritance for example.
“Becoming a landlord isn’t easy – there are plenty of requirements. Understanding the landlord’s role is vital in the overall context of a national strategy. What will attract people to providing that service?”
Kickstarter
“I hope that the new government and a new minister [Simon Coveney taking over from Alan Kelly] will kickstart this,” says Lyons.
The first thing we need is consensus and evidence, a new study commissioned that people actually agree on. Until you do that and compare to best practice in other countries you can’t get clarity on where the problem is.
The alternative is far from appetising – people being priced out of their own homes, living at home with their parents, commuting longer distances, and poorer households simply being priced out of the market completely.
“If things continue as they are I would fear for foreign investment into Ireland,” says Lyons. “What company will come here if their employees can’t afford the rent?”
“At the moment a landlord can increase the rent because they can,” adds Large.
There is no alternative. And as things stand rents will continue to increase and other things will have to give. And that’s not sustainable.
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Build.
Mr. Lyons,
The system is functioning properly for those who operate the system for maximum profiteering at minimum effort. It’s not working for the majority for whom housing a basic necessity.
Can we incentivise some of these international funds to build some real quality high rise apartments. With 3 bedrooms decent living space roof top gardens and full services?
Stop housing people in free council houses in the centre of the city. There are 11 blocks of council flats basically on St. Stephen’s Green; the vast majority are unemployed. Get them out, and allow people who actually work in the city centre to live there, ie young professionals.
These young professionals then move inwards from semi-Ds around the city which frees up these houses for the next generation, ie young families who would like to live in Dublin but also have a garden, then these will be spared the hour commute from Mulingar because they aren’t competing with young professionals who have more disposable income.
Don’t be fooled by the media, there is no housing crisis, there is simply a crisis of people who insist on living in Dublin! Only three years ago we were talking about thousands of ghost estates, do we have the memory of goldfish?!? Anyone who does not work yet wants a house for free, out you get, overnight rents would collapse and make living reasonable for everyone
Apparently the costs of building quality high-rise apartments is still outweighing the profits for construction firms/funds. Not sure if incentives are required, probably just a reduction in bureaucracy and some unnecessary building standards (for instance, it’s probably not essential to have windows facing two directions). Would be interesting to see an analysis of the costs and see can we eliminate any needless red-tape costs/barriers.
Michael Johnson, have you been outside of Dublin? There most definitely is a housing crisis. The country doesn’t stop at the border of Dublin.
Yes I have and am a firm believer in decentralisation from Dublin ad investment into Limerick in particular as a counterbalance.
Unfortunately the stats don’t support your theory though.
The answer is simple. Produce more accommodation. The amount of farm land inside the m50 ring road is unbelievable, just look at Google maps. Go high rise with quality apartments and build a rail service to allow people commute to work. Incentivis building with a lower tax rate. Incentivis landlords to let properties with lower tax on rental income. It’s not rocket science.
I don’t understand. Rents and property are rising, labour costs and land is not at boom prices, interest rates on loans are low. Are we saying that builders can’t get loans or that they won’t build without making boom level profits. Cutting the vat rate just cuts the sale price of new homes but I don’t see it boosting supply.
Michael there is a housing crisis and the main problem is in Dublin. Asking people who live and work in Dublin to move to a ghost estate in the back end of nowhere is not the solution. That’s not where the jobs are.
The solution lies in building homes in Dublin. Preferably well designed high density with good transport links. The curse of Ireland is lack of density. All modern urban societies work on density and scale. This is what allows services to be affordably delivered. All modern industrial societies require major urban areas to generate wealth. On this scale Dublin as currently designed barely qualifies. Too few people spread out in a badly designed urban environment. The solution is not to spread them out further but to concentrate them further in well designed urban environments.
Or the solution is developing economic activity in places outside Dublin which presently accounts for 42% of Irish GDP. A large proportion of the people who work in Dublin can’t actually afford to live in Dublin and a large proportion of the people who actually live in Dublin in tax payer assisted social housing don’t work.
Hi John, you must have misread my comment because I specifically stated “people who do not work”.
The rest of your comment makes perfect sense. However I do believe that we are the ONLY major European capital where social housing is provided in the very heart of the city, and that is a problem
Well said Brian, moving social housing recipients who do not work out of Dublin not only frees up affordable accommodation in the city centre but would also boost the economies of struggling towns by the additional people purchasing goods / services.
It would also remove vulnerable young people from inner city areas rife with drugs and crime and give them a better chance in life.
Brian Dublin tax revenues support a great deal of the country. Social housing in Dublin is often occupied by people who work but who can’t afford homes in their own. If those who are unemployed and in social housing were moved from Dublin they would still need social housing elsewhere.
All industrial societies have mega cities that generate vast wealth. Dublin is barely a capital city in scale and already people want to downsize it. Given Dublin’s small size a housing solution is perfectly feasible.
In terms of jobs the Govt does not determine where jobs go. The private sector does and all over the wealth jobs are concentrating in areas of scale I.e. cities and towns. This is an inexorable consequence of industrialisation.
The main problem In Ireland is terms of pollute ion and job location is bad rural and urban planning, bad design and an inability to plan for the long term. Most of these flawed policies are supported by large segments of Irish society. We are an anti-intellectual culture. We want to have our cake and eat it. There are really only two political parties in Ireland. Sinn Féin and Mé Féin.
http://www.irishtimes.com/business/government-rent-freeze-is-not-working-says-ronan-lyons-1.2642118
“Safety certification costs in the Republic were 100 times more expensive than in Northern Ireland and this was adding €20,000 to €30,000 to the cost when building”
Simon Coveney should probably look into that for starters..
Meanwhile the Credit Unions have €5 billion + in deposits and have been pleading with the government to make the money available to address the housing crisis, through for example Housing Association loans to purchase homes. The problem from the government’s perspective is that such a move would benefit the majority. Our state in contrast has always served the interests of capital owning minority and so has long fingered the proposal.
http://www.thejournal.ie/credit-unions-social-housing-fund-2667513-Mar2016/
In parallel, NAMA has been presiding over a vast firesale of land and property assets at knockdown prices to the international vultures while a domestic homeless epidemic rages and a terminally ill child sleeps in a car. It’s a feeding frenzy for the speculative sharks and the blood in the water as ever is that of the working class while cheerleaders like Nick squawk their approval from the sidelines.
http://www.thejournal.ie/readme/housing-crisis-2679373-Mar2016/
I am a Horse wrote:”Incentivis landlords to let properties with lower tax on rental income. It’s not rocket science.”
But my Property Consultant Landlord has all his houses registered as Private Houses, not Rented Properties.He’ll never get detected on this, because there is no State Agency trying to detect this.
I presume most other Landlords are “in” on this game, which probably means most Landlords / LandLadies don’t pay tax on rental anyway. Or if they do,, maybe that’s because they are not “Corporate” LandPersons.
The govt.as per usual is making things worse, landlords have to deal with more and more regulations regarding getting problem tenants out, getting a market rent, having to take social welfare and associated problems. Hence the supply will be reduced, as landlords can’t take all the risks on behalf of the state.
the government have no ideas
I am fortunate to still be paying well below market value for my one-bed apartment (€460 per month, moved in 2 years ago). If I was to try and find something now, I wouldn’t be able to, especially as I can’t stand the thought of living with strangers anymore. The cheapest I found was €500 for a small bedroom. Due to stomach issues on a regular basis, I prefer to have my own bathroom if I am living with others, out of courtesy for them. If I was to get what I have now, or actually, a smaller place than I have now, I’d be looking at paying about €1000… I’m not in Dublin. I’m in Cork. Yes, I’m in the city centre pretty much, but that’s because it’s convenient for work and shops given that I don’t drive.
There most definitely is an issue with rent prices all over the country,.
So, where are you going to put all the people who you’ve just pushed out of their homes Einstein?
Micheal, firstly, you are focusing on Dublin but the crisis is countrywide. Secondly, the ghost estates you refer to are empty because they don’t have the infrastructure to support them. There is no way to get food, clothing, fuel, etc. To suggest that people on welfare should be forced into a situation where their extremely limited resources would be strained even further suggests either a lack of knowledge on the subject or a worryingly low level of empathy.
€1300 for a 3 bedroom house in the absolute backarse of Tipperary with a BER rating of G. Out of control
Adding that the same house was going for €550 a few years ago
€1300 for a 3 bed in Tipp!!!!
Max 800 850
Not even Tipp but one of the backarse villages ages away from the nearest town.
Must be a very special house…….
The majority of politicians are landlords themselves so have a vested interest in maintaining the Status Quo
Ah maybe the government should get NAMA to stop selling in bulk to vulture funds, maybe change the legislation on the land and conveyancing act that they changed during the last dail term…
Took the words out of my mouth NAMA needs to die. It’s corrupt to the core. And boot Noonan out while we are at it well boot most of em out.
I can’t understand it…. The country has a homeless crisis, mortgage crisis and a housing shortage…. Yet we have NAMA who has portfolios of property….. Who is owned by the taxpayers, paid for by the taxpayers. Yet not helping the taxpayers.. Something seriously not right……
What’s the percentage of NAMA portfolios in non-commercial properties?
How many of these non-commercial properties are currently in a habital condition?
Danny… Only know what I read in the Irish media…. Here’s a link from last month….
Thousands of homes will be included in a massive Nama sell-off of property loans worth nearly €5bn.
SHARE
A host of international funds are set to swoop for the two portfolios of loans, which have a face value of €4.7bn.
The residential properties in the mammoth sale are understood to include apartment blocks, mostly around Dublin.
It comes amid allegations that tenants have been forced out of their housing estate in Dublin following an overseas investor buying loans tied to their homes,
Nama formally kicked off the sale process of the portfolios yesterday only days after tenants in Tyrellstown, west Dublin, were informed their leases would not be renewed.
http://www.independent.ie/irish-news/family-homes-in-nama-5bn-vulture-fund-sale-34544139.html
Danny , included in one portfolio is 300 vacant properties…..
These include, according to the Irish Times, 950 residential properties, mainly apartments, 650 of which are occupied by tenants and a further 300 vacant.
So hang on a minute! Yes, you read that right. NAMA is currently selling 950 apartments to the vulture funds. And what’s worse 300 of them are vacant.
It doesn’t matter if they sell them to vulture funds or not. They will have the desired effect as soon as they enter the renting market. The culture funds might be the only crowd in town able to invest and these properties on the market.
Let’s move to a European model of renting as apposed to owning a home. All well and good but then we find ourselves in 2060 with 80 year olds having to work just to pay rent, but of course the government pension will cover that, won’t it?
I don’t think the Irish pension would be sufficient to cover the costs Jonny. Very misleading to suggest otherwise.
Also running the risk of being evicted from your lifelong family home so that “refugees” can be homed just to suit some gibbering leftist agenda.
http://www.telegraph.co.uk/news/worldnews/europe/germany/11902296/Second-German-woman-evicted-from-her-home-to-make-way-for-refugees.html
The credit unions are chomping at the bit to invest BILLIONS into housing.
Stop f#####g about and get it done.
This is a crisis. People and families of all ages are being made homless.
The solution is there, so the question is not what should be done?, but why is it not being done?
The credit unions aren’t doing it for the national good, they are looking for a risk free profitable investment
And your point is???
You expect them to invest to make a loss do ya?!
It’s been thrown around like its free money, it would be cheaper to borrow on the markets so if the government took their money it would be a really bad deal
You’re saying that the credit unions are going to lend the money to the government?
I think someone *maybe not you* is mixed up about what the credit union is offering!
To whom are the credit unions lending the money
It’s unregulated and out of control. Noting will be done about it… at lease not by this Government.
Unregulated and out of control immigration is also a massive factor. Over half of the people on North county Dublin’s housing list are immigrants.
If Irish people want more houses available for them and their kids then stop giving rent allowance and free houses to 3rd world spongers.
We better recall all those millions of spongers we’ve got in every corner of the world then eh
What evidence is there for massive amounts of welfare claimants rates for the Irish abroad? Have you any links or evidence? I can tell you Nigerians are banging in around a 70% unemployment rate in Ireland. Why are they even here?
Besides if a country wants to deport Irish people then that is up to that particular government.
The situation i described i happening inside our borders and is our problem.
And what is your claim based off? Quantifiable fact or just your general racism?
http://www.herald.ie/news/over-half-on-housing-list-are-foreign-27973856.html
Try that website, i cannot get it to link for some reason but that was from 2011 and they have gone totally silent about it since then. Wonder why?
So where’s those Nigerian unemployment stats you were on about?
Did you just make up that stat there John? I believe its a a bit lower at about 40 percent.
And that doesn’t take into account factors such as discrimination etc….http://www.cso.ie/en/newsandevents/pressreleases/2012pressreleases/pressreleasecensus2011profile3-atwork/
Noonan is quite content to let the free market rule. That’s fianna gael policy so I don’t know why people say why don’t they do this and that and if only they understood etc. They do understand and what we see is their policy’s in action.
Noonan is a parasitic leech, the only way that it’s going to ever come down is if a regulatory body was put in place. Good surveyors making the landlords etc price the property according to its size, location, noise level, amenities so on so forth. Can’t be that hard to put a bill in place. As long as the landlords are getting that and it’s far out of the reach of catchment for social homing they will charge through the roof. Greed is a human condition. A lot wants more. Humanity in this country is at a steady decline anyhow. Devolution is happening every day in this country. Storm the Dail and throw them all out. Worse cabinet ever!!
High density in areas where people want to live. Make good apartments so people want to live in them. Get rid of storage heating.
Storage heating has been gone for years on new builds
I think we should all just keep the recovery going….
The solution is simple. Build more houses, lots more houses. The political will is not there though. They would rather farm it out to developers and make those who buy their own house pay for it via part 5. Then they allow builders buy their way out of part 5 and use the money on something other than housing.
You have to allow builders to buy out of Part 5, otherwise they won’t be able to sell the house as potential house purchasers will stay away as they choose to pay highs prices for houses in order to not live next to social housing.
Or no builder should be able to buy out part 5 so people have no choice but to live among all types of people. Even if part 5 buyouts were allowed the money paid, is paid in lieu of social housing, so the amount should cover and be ring fenced for the provision of an equal amount and quality of social housing elsewhere.
That’s not fair on the person who has worked hard, saved their money, obtained a mortgage and purchased a home only to find out that they are to be right next door to a social house.
Why should people try and better themselves and aspire to live in a nice estate with like minded hard working professionals if they are just all going to be mixed in together with social housing tenants who pay next to nothing for their house?
Sssssh Ned your not allowed to say that
I know PJ but you have to call a spade a spade sometimes. I cycle through a lot of social housing estates on my morning commute and it’s frightening to think they they want to mix 50% of these people who dump rubbish in green areas to make bonfires, cars left abandoned on the side of the road etc in with 50% of hard working professionals!
Sure put them all in camps eh ned.
Put them all together in their own estate, Emachine. Away from contributing citizens of this country. They can destroy their own estate all they want, they’ll be the Councils and Housing Agencies problem then and not the problem of hard working folks who’d have to look out at the mess they make if they lived beside them.
I think I’d rather live beside people in social housing than you Ned, you sound horrible.
The truth hurts Aine, people don’t like to hear it. Everyone knows the Social Housing estates turn out to be complete dumps in a matter of months. Why would a decent contributing member of society want to spend a couple of €100k’s buying a house to live beside someone who gets the house for practically nothing and ends up not respecting it?
Meanwhile how many empty houses and apartments are there out there? Hopefully the census will help answer that question. A house is a place for people to live in NOT an investment. Until we break the link between property and perceived wealth this problem will just get worse.
Government policy should ensure that property prices should be kept at the lowest possible level. Japan has shown the absolute stupidity of thinking that high property prices are anything other than disastrous for society in general and the economy in particular. Only bankers and the non productive sectors benefit from high property prices.
There is no such thing as a property ladder for most people. It only has two or three rungs.
I’ll never forgive all the Nimby groups that left areas like the IFSC and East Point as low rise office and apartments .The IFSC would probably fit into Canary Wharf in London yet we have a city that looks like its trying to win a pancake competition. Absolute lunacy
The estate agents are inflating the price of rents 5 years ago daft had mostly private rentals from the land lord about 90 % and 10% to estate agents letting houses now that has flipped to 90% estate agents 10% landlords what that means is the estate agents are putting extra money on top of the rents.
Their was a house for rent in my area a few weeks back on daft the estate agent was looking for 800 a month I knew the owner and gave him a call and he told me that the estate agent was giving him 600 a month for the property that’s 200 a month from a teneant of that property to an estate agents for posting an ad and letting the house so if you signed a 12 month lease you would be paying the estate agent 2400 euro for showing you the house signing the papers and answering a few phone calls a year the estate agents should be hung for that and their income from a let should only be a fee of 200 per 12 month lease not 2400 I’m sure other properties yield far more for the estate agents than this one the government needs to regulate the estate agents. If you red thumb this post its clear you are an greedy estate agent putting out the less fortunate in the country for their own gain
Estate agents are parasites…
They add nothing to an economy especially now where people are free to advertise on websites. 20 years ago they had a purpose. No longer
I see their is 11 estate agents not happy with my previous comment. Ye should hang her heads in shame along with this joke of a government shortage of house time to start buildings create jobs and takes people off the register lower taxes on landlords so they can five cheaper rents and put the tax take from all the jobs created aside to make up for the shortfall in reducing the tax on landlords. Things need to change or this student with 8 years third level education in technology will be out of the country and never coming back
In 2015 there were 70,000 immigrants to Ireland. It is no accident that rental prices are high.
http://www.cso.ie/en/releasesandpublications/er/pme/populationandmigrationestimatesapril2015/
Even when it was the bears I knew it was the emigants(sic)
You are brain washed. Property prices are supply and demand.
If you’re going to blame immigrants at least post some stats that back up your claims you big thick.
Those figures show that more people emigrated than migrated into the country.
Yes but those two groups exiting and entering the country are separate groups. The ones who leave are a solution to unemployment and unaffordable housing. Curtailing immigration at least while we have this problem would mean that demand for rental accommodation is reduced.
Being pro immigration is not the default position of a good person. Its the default position of a complete egit who has no grasp of economics.
More people did/do emigrate but I think there is still a big problem with the numbers. Most people who emigrate are young and most of them are leaving their family homes. Every immigrant has to find somewhere to live and most of them come to Dublin. I’ve no issue with immigration, it’s not their fault that there’s a housing crisis here.
Of course its not their fault. It is however our fault if we don’t act in our own economic interest.
so it has nothing to do with supply and demand like you said 15 minutes ago but you read the word “immigrant” and assume that person can’t productively contribute to the economy?
can you explain how the people, Irish or otherwise, that migrate are the solution and people that come here to live and work aren’t part of the solution?
@Conor.
You have a point. In Waterford there has been a huge influx of illegal Asian immigrants from Britain through Belfast down to the Republic in the last two years. In order to qualify for a PRSI No an address is required so they are willing to pay well above market prices to secure apartments. Of course landlords and letting agents who never look a gift horse in the mouth have been exploiting this to the max with the result that rental prices in Waterford have seen a huge hike in the last year.
Ironically many immigrants from the same countries are suffering as a consequence as their jobs are also under threat by this new wave of illegal immigrants willing to work for less wages.
It has everything to do with supply and demand like I said 15 mins ago. I dont know why you think that has changed We are talking about the price of rental accommodation. More people who want to rent means higher rents. Its not complicated.
I am not looking to vilify immigrants be they legal or illegal so dont want to separate those two groups. We also have no ability to control illegals so they are not really my concern. We do however have an ability to limit legal immigration to Ireland and that would help with the price of rent and our unemployment.
Conor, have you *any* idea how many companies in Ireland would collapse if the proportion of their staff who have immigrated weren’t available? Try working in software, offices are like the flippin UN, and all the better for it.
Here in the real world, you need people with the right skills for the job, and Ireland only has so many of them, so we need to recruit people from outside Ireland. We should be thanking our lucky stars that people are coming here, because the tech boom would be dead in the water without them.
That is fine Day-v Fatter-tea.
For you access to labor is more of an issue than access to affordable rental property. That does not mean that those people do not create additional demand for accommodation. Also all 70,000 of them are not skilled. Many of them are students coming here to study English or work minimum wage jobs. Someone has to lose out because the problem is too much demand and not enough supply and despite high prices supply is not making itself available.
Immigration is not a sacred cow. It makes the economy grow but it also creates higher prices for essentials.
@Conor You are 100% correct and people are just too blind to see it.
To take your theory back a few years it was the real cause of the boom and bust of property in the first place back in 2008.
We had a workforce of 1.3 million in 2004 when the floodgates opened and we took in over 300,000 immigrants. What happened 4 years later? Immigrants started going back to Eastern Europe and house prices collapsed.
People need to see it as Conor outlined in supply & demand terms. It doesn’t matter where they are from or what race they are, 300,000 people means 300,000 beds means 100,000 units means prices skyrocketed! The same is now happening as immigration increases again but we are all too PC to see it!
So short version, everything is the fault of Johnny Foreigner. Got it.
There’s certainly no evidence to suggest historic mismanagement of property and development in this country is an issue. Nope.
Supply and demand Vay.
It’s economics 101. If you want to make your judgements by emotion work away.
My partner is an immigrant. I have met many wonderful people from abroad over the last few years. That does not mean that curtailing future immigration, at least temporarily, to solve social and economic problems is off limits. Also stop trying to put words in my mouth. Nothing is the fault of immigrants. They are just doing what is best for themselves. Its up to us to make responsible decisions for Ireland and our benefit. I do not know why this is an emotive issue for you. I am not suggesting we tell anyone to leave. Just put a limit on who comes, until we get our house in order.
Your partner is an immigrant and you don’t want to let any more of those brown people in – are you Donald Trump?
The simple solution (yes there is one and it won’t cost the tax payer a penny) is to halve the tax on rental income. This would make it worth homeowners while to rent or sub-let unused or underused homes. This could be for a three or four year period until supply catches up with demand. The loss of tax per rental will be made up for in increased properties available. As regards building, if the Irish developers could access loan finance at the same rate as their German equivalents there would be a lot more construction – whatever happened to a free market EU? There’s no competition in the banking market- that’s for sure. I wish the Eurocrats would work harder on freeing up the “common market” and less time on social engineering.
You are forgetting that much of the German loan finance is available because Ireland absorbed the banking debt of most of Europe.
Minimal risk of repossession in Ireland, lots of “won’t pays” pocketing rent and driving up mortgage rates for everyone else. http://economic-incentives.blogspot.ie/2015/12/a-year-in-cork-repossession-courts.html?m=1 German rates are much lower because there was always swift repossession if you didn’t pay and equity in the property. Also rates are based on personal credit rating so that 2 civil servants at 50% LTV can get 0.9% fixed for 8 years or ~1.6% fixed for 20!
Entering this market is still too risky for most banks although the CB’s LTV and LTI rules help.
I’m sorry, but rent *is* dead money.
Do something about *that*.
So is buying food, Going for a few pints, getting your car serviced. Rent is paying for a roof over your head. A lot of people are paying too much tax and rent to be able to afford to buy right now, Me included. I’m not going to go homeless until I can afford a house to avoid spending “dead money”.
What’s interest then?
Yeah but how do you pay your rent when your income collapeses aged 65? renting is a mugs game long term
I’m saving to buy a house. Rent is going up and up so saving is taking longer and longer. I have no choice other than renting a house right now. If that makes me a mug then fair enough. I’ll take it over homelessness any day.
Living in Dublin working 12 hours a day in an Ok paid job. I would be better off on the dole living with my parents I would have more money to myself. The price of everything is going up but not wage or any job scheme in the country. They gave out because min wage was to be lifted 50c per hour. Do not know anyone in a low paid job that got that.
It is beyond a joke. It will cause another crash when people do not even have the money for the simple right to live!
The Neo liberals just have to print more money and give it to people to build more houses and related infrastructure. Duh.
All it takes is a “keystroke” apparently. With the advances in 3D printing technology now we’ll soon be able to print disposable 3D builders who work for free and eat nothing. It’ll be grand.
Can’t we just use the neo liberal printing presses to print houses?
Sorry no, they cant print duplex.
Maybe it’s time to consider a bedroom tax???
constructive problem solving not allowed?? OK. Blame Alan Kelly. Build houses now. Force the banks to lend huge sums to developers to make houses now. what could go wrong?
Maybe it’s time to stop getting ideas from the Tories handbook….. What’s next?….
it is a short term solution. There are thousands of houses with one or two people pottering about them. They could live in the apartments with families that are too big for them. incentives don’t work. If the carrot doesn’t work, use the stick.
How would that help?
The Government’s so-called “Bedroom Tax” policy has been declared discriminatory and unlawful by the Court of Appeal.
Judges made the decision following a legal challenge against the Government by a domestic violence victim and the family of a disabled teenager.
The bedroom tax is one of the most abhorrent taxes brought in by the Tories. A pensioner in the UK committed suicide because she couldn’t afford to pay the tax and didn’t want to leave her home and move away from everyone and everything she knew. The solution isn’t to punish people who have homes, regardless of whether there’s a “spare” bedroom or two. My parents have a 4 bed semi detached house and they now live alone but their house is always busy, there’s always someone staying over or coming home to visit etc.
Hey … Patrick , does your plan include all the rich people in their mansions with tons of spare bedrooms or is just a plan for the little people……
Whatever helps little one. Even if the issue of will to build is sorted out there is still the issue of space. Thousands of houses could become available for private renters. Give tax breaks for landlords who rent out their own houses to live in smaller apartments. whatever is needed. but supply isn’t going to change any time soon.
Maybe if the government stopped NAMA selling properties in bulk that might help……
A host of international funds are set to swoop for the two portfolios of loans, which have a face value of €4.7bn.
The residential properties in the mammoth sale are understood to include apartment blocks, mostly around Dublin. Among these properties are 950 apartments , where 300 are vacant…
It comes amid allegations that tenants have been forced out of their housing estate in Dublin following an overseas investor buying loans tied to their homes,
Nama formally kicked off the sale process of the portfolios yesterday only days after tenants in Tyrellstown, west Dublin, were informed their leases would not be renewed.
http://www.independent.ie/irish-news/family-homes-in-nama-5bn-vulture-fund-sale-34544139.html
If you want people, say older people to down size, you make it very attractive for them, you do not beat them with a stick. Idiotic Tory boy policy.
I’m not a tory by any stretch. however in a crisis you need to examine the choices. Roaring for more houses doesn’t fix anything. Even despots have good ideas every now and then. Didn’t the tories introduce the NHS?
“I’m not a tory by any stretch”
If it looks like a duck and walks like a duck, it is a duck.
Landlords have to pay about 50% of their rental income to the Government as Tax! Is that fair?
Build more houses & apts !
in 2015 there were 70,000 immigrants to Ireland. It is no accident that rental prices are high and only climbing.
http://www.cso.ie/en/releasesandpublications/er/pme/populationandmigrationestimatesapril2015/
What exactly is wrong with limiting immigration during a housing and employment crises? Bizarre.
from your link:
“This resulted in estimated net inward migration among non-Irish nationals from outside the EU of 12,700.”
One problem is most definitely the land hoarding issue. I saw that planning permission was granted along the quays in the docklands for a major development in March 2015. Here we are in May 2016 and no sign of any construction. I looked up who the buyer was. Their name was “Targeted Investment Opportunities”. That says it all. They have no intention of building – they buy the land, obtain planning permission, hoard the land, then try to sell it on at a profit.
We need a land tax on undeveloped land in the city centre. If the owner is unable to develop it or pay the tax then they will sell the land to someone who can develop.
I hope the CSO publish just how many vacant houses there are in Ireland, becase there are more than enough to end the homeless crisis. And yes I know, location, location, location.
Not a very positive or uplifting article. Typical fearmongering and click bait from the Journal!
This crisis is 2 years old now and NOTHING has been done. FG are the landowners party. FF are the builders party. Both vested interest. Alan Kelly produced an excellent document on this and was vetoed by Noonan. We get what we vote for. Heres whats going to happen. FF/FG will put the lean on the central bank to loosen mortgage laws. Once builders see they can make a large profit they will build again. The people will borrow huge sums of money to buy expeniseve property and an asset bubble will occur. Again
So many things need to be done, developers sitting on land need to be taxed quite heavily unless they either sell or develop. Landlords should only be taxed on the difference between their mortgage and the rent they are taking, if they don’t make any profit they don’t pay any tax on the property they are renting out. Nama are also sitting on vast amounts of property, these should be all sold to local authorities asap. More high rise apartment blocks should be built in Dublin, and to a lesser scale in Cork, Limerick and Galway.
I’ve just left Dublin because I was paying a high rent on a places that was similar to where I lived thirty years ago as a student and the other tenants were graduate types. The place had a number of defects that caused it to fail to meet the minimum standards: no heating, no freezer, no microwave, nowhere to wash or dry clothes. Yet the PRTB rubberstamped the building managers’ request to raise the rent to the market rent maximum.
How many times have this so-called defender of the people given a free pass to owners? I’d argue a place that doesn’t meet the minimum standard of housing is un-rentable and therefore has a market rent of zero.
The answer is to elect a government that gives a fcuk about the citizens of the country.
Limit rent increases to 5% max p/a.
Kelly’s 2 year rent freeze resulted in many landlords jacking up rents well beyond what might have otherwise applied.
Stop funding the Irish language and invest in housing.
Poor quality and high price, time to move for many.
page 7 for 2011 CSO housing stock, nice pie chart in top corner
http://www.cso.ie/en/media/csoie/census/documents/census2011profile4/Profile_4_The_Roof_over_our_Heads_Full_doc_sig_amended.pdf
EU rental averages(33%) are slightly above Irelands @ 31% and higher if you take all the new EU entrants into account
http://appsso.eurostat.ec.europa.eu/nui/submitViewTableAction.do
We’ve been looking at inaction for years where the politicians don’t know what to do and its right across the board. They’re quite happy to take a passive-aggressive stance towards everyone who tries to challenge them. If we were to suggest building houses- ahh financial crisis, cant do that, same excuse for social housing. If we suggest rent caps- ahh you cant interfere with a free market. When they give on one side they then tend to escalate costs for landlords by subjecting them to an increase in tax on both capital and rental income. There is a very closed mind-set at work here-one that believes in profit more than welfare and its been choking this state for decades. Commentators, myself included will always have some bias but given the situation with Dail members, it seems that anyone who dares too speak out on stagnating or unethical practices, will be subject to legal redress. We really are in a hopeless crisis with no sign of salvation coming unless maybe renters start a union of sorts. Now that would be a fairly powerful lobby group.
Well you can lower taxes for a start. The biggest winner in increased rents, and therefore having a de facto material interest in increased rents, is the government. As usual they are a huge part of the problem. PRSI and USC on rent means they higher rent goes, the more they collect. Add in negative equity and it’s easy for property rental to be a complete losing proposition.
Reduce the cost of building by going after Building suppliers who some how managed to keep the prices almost the same throughout the entire housing crash.
There is a housing shortage, and there are ghost estates with empty housing. At the same time.
Like most people, a place on a “ghost estate” wouldn’t exactly be my first choice. The lower-income earners that might live there, would struggle to afford a car. These locations need functioning public transport. Dublin’s satellite towns need functioning public transport.
The routes are unlikely to be profitable at the beginning, but it would be quite affordable to subsidise privately-operated public transport with standard commuter fares, to be reviewed a few years down the road. We’ve seen that neither Dublin Bus nor Bus Eireann are motivated to create new routes for shifting population patterns.
Its all a con, most countries future plan, When the market crashed I do know big companies did close up, but the government should of helped the construction companies instead of balling banks etc this also would of helped one of our biggest employers, which then helps many other industries, property prices would of doped but at least the ordinary hard working could of afforded a home. The millions that has been spent on social welfare would all so been saved.
This is ridiculous, another article pointing on the reason behind this crisis as houses are not built, and the only solurion is to freeze rents? That’s mad, do u think we are stupid? Tell me why houses are not built? Why this communistic thinking the only solution?
Wise man would analyse exactly reasons behind this low supply, ie why in the city is a ban for building ie skycrapers or high buildings? Why government is not forcing owners of empty parcels or neglected sites to sale? Why there is no clear registry about ownership of every meter in the city? Why government has so many parcels in the city with supply problem of housing? Why there is so much bureaucracy regarding selling, buying or investing in building? And why so many houses in town (probably more than half) has living conditions adequate to half a century ago? These answers we r looking for. This article is copibg what we already know.
Ammmmmmm Let me Take A wild And Stupid Guess ( Start Building Houses ) I know it’s a stupid idea
house people in Ireland, not just Dublin/Cork, build communities in and around the beautiful villages around the country, reasonably priced land, warm friendly towns, it’s simple
build high rise buildings… Dublin is gonna get taller..
Maybe our finance minister should pursue some debt relief and use any proceeds to build some homes for people or would that be ‘market interference’?
Jez Kelly left an awful mess.
How about rent control, which helps the tenants and also lowering the tax landlords pay on rental income which can be as much as 60 %. The government makes a fortune out of high rents.
Unjustifiably high rents is nothing new in Ireland. The land league in the late nineteenth century fought for tenant rights and successfully got a foreign government to intervene and introduce legislation to bring in tenants rights such as a fair rent decided by court order and the right to tenure of your home once you paid that fair rent. The market is absolutely skewed at present and it’s going to take years for supply to catch up with demand. If the government would protect their citizens and introduce legislation to mandate fair rents for citizens and to protect tenants who pay their rent and face threat of eviction that would alleviate the crisis in the short term while a longer term solution is drawn up to solve it.
Mass build of social welfare properties. then move social welfare tenants from private rental properties on rent allowance to these properties freeing up the private rental sector.
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Currently there is a gouging competition of the consumer. The government gouges through high direct and indirect taxes of the price you pay/rent for a house. The banks and vulture funds, gouge both the builder and the house buyer through exorbitant interest rates. Landlords are gouging at a rate not seen since 2008. The landowner gouges through exorbitant land prices which is passed onto the consumer. The vested interests in the construction sector are claiming they’re not gouging but are seeking tax breaks to gouge the taxpayer, and between them and the landholders are gouging by controlling the rate of house building and land available for house building. Is it any wonder that house and rent prices are unaffordable with this gouging competition. And don’t forget the gougers in NAMA. Tackle the gouging, be ruthless about it, take on the vested interests and get the consumer and the taxpayer what they deserve, an affordable place to live.
Well said David Wall and it goes to show the gaping chasm that exists between the man on the street and the government we just elected. They take our tax and use it to give themselves a wage and in return they provide us with services that we need, such as regulation. That simple transaction has turned into a con job, see the scam on housing costs, motor insurance and water et al. We need to insist on our “consumer rights” and demand satisfaction. If we paid our tax ourselves instead of automatic deduction from our sheep salaries maybe then we would have a source of power that we could wield. They have psychologically out thought us when we weren’t looking and have cleverly taken away our weapons that we would have used to fight back.
Solution to take the pressure off while home are being built convert to office space after use
Irish Constitution is the root problem .. does not explicitly state the “Right2Home” like the German Constitution. As long as this persists then the Irish, their kids and grand kids will continue to be abused by financial predators long into the future.
All this bullshit when a solution was offered by the Master of the High Court…. Could easily be sorted. Wake up people
A solution to the rent crisis and the housing crisis. Landlords and other vested interests would crap themselves
Now that is rocket science ?
What does the IMF say, that is sarcasm by the way?
Knock all the old property and sell it to IMF appointed builders and landlords. Who will build new buildings and charge the government extra by selling it back to them. This will cost the prices and rent to go up and therefore anyone who is poor will not be able to live in Dublin or any other city?
have your say