News and Views

How can we solve Ireland’s housing crisis?

30 Aug
The proposed Horgan's Quay development, HQ, features eight buildings, with 237 apartments, a hotel and 400,000 sq ft of offices.

Joe Finnerty and Cathal O’Connell, of the School of Applied Social Studies, UCC, outline the multi-level response needed locally and nationally to tackle it.

The scale and complexity of Ireland’s housing crisis might suggest a social challenge of insurmountable proportions. Indeed, there is much evidence to support this pessimistic view. Many young adults wishing to purchase a house face a triple-whammy of rent and house price inflation coupled with job insecurity, often forcing them to live with their parents for extended periods. Tenants in the private rented sector, including those in receipt of housing benefit (Housing Assistance Payment or Rental Accommodation Scheme Supplement) are facing steep rent increases — even for sub-standard and insecure accommodation. The more unlucky or vulnerable tenants dislodged from the private rented sector end up sofa-surfing with friends or swelling the ranks of homeless persons. The number of our citizens in some form of emergency accommodation has more than doubled in three years, from around 4,350 in May 2015 to 9,900 in June 2018. Of particular concern is that this homeless population includes children, whose number has more than tripled from 1,211 to 3,824. Meanwhile, the traditional policy response in the form of local authority housing had a backlog of almost 72,000 households in June’s social housing waiting list — close to a quarter of a million people.  It is understandable that people see the housing problem as interminable — one set of problems piling up on another making solutions difficult to ascertain. Many see these different facets of the housing crisis as evidence that the government is ‘doing nothing’. However, this popular view confuses inaction and ineffectiveness. The government’s Rebuilding Ireland strategy sets out a wide range of measures to remedy the housing crisis and includes establishing rent pressure zones, increased social housing expenditure, boosting private house construction and tackling homelessness. The government describes Rebuilding Ireland as “ambitious and imaginative in its reach, and radical in its approach”. While it is important to acknowledge what progress is being made, it is equally important to point out where current policy clearly is devoid of ‘ambition and imagination’ and fails to be ‘radical in its approach’. Most people look to the social housing system as the source of long-term secure housing, and rightly so. However, the policy trend in recent years has been away from secure social housing tenancies provided by local authorities and housing associations and towards what the government terms social housing “solutions” provided by the private rented sector. This type of language is a code for the private rented sector. By way of illustration, in 2017 of the 26,000 social housing solutions delivered almost 19,000 were in some way sourced through the private market. Local authority building, acquisition and voids provided just over 6,000. A social housing policy so reliant on the private rented sector can very easily perpetuate to become part of the problem it is trying to solve. Compared to many other countries, private renting in Ireland is poorly regulated in terms of tenant security, housing quality and above all affordability. Tenants can be legally evicted on a variety of grounds such as refurbishment, health and safety, sale, etc. as has been seen in the case of the Leeside Apartments here in Cork recently. How the government pays for these is private rented ‘solutions’ response is also an issue. The HAP scheme, in the context of competitive urban rental markets, likely contributes to rent inflation in our cities. In the three years between 2018 and 2021, the state will pay private landlords €3 billion in rent subsidies including HAP, much of it in an effort to keep pace with rising rents. A multi-level response is needed involving national and local actions.

Actions at national level

At national level a reformed private rented sector and a reformed HAP have significant roles to play in providing accommodation for households choosing to live in the sector. However, it is important that we have a properly functioning social housing sector which provides secure, affordable tenancies and contributes to flourishing families and communities. While the housing association sector makes a valuable contribution, especially for vulnerable households, the scale and complexity of the housing crisis requires the local authority sector to be restored to its lead role in building homes for low to middle-income households. Loan finance is available and local authorities need to avail of the borrowing facilities offered by the state’s Housing Finance Agency. Local authority rent policy also needs to be reviewed. The income-related rents regime has been very beneficial to low-income households but has starved local authorities of revenue to invest in and maintain housing stock. A cost system whereby rents charged reflect more closely the cost of provision could potentially put social housing on a much more sustainable financial footing whereby rents charged reflect the cost of provision could potentially put social housing on a much more sustainable financial footing. Selling off local authority homes under the tenant purchase scheme also needs to be reviewed. While it has given thousands of families a foothold on the property ladder, this scheme eliminates valuable stock from local authority estates and bizarrely a proportion of these end up in the private market for rents that are far higher than local authority rents.

Actions at local level

Much is currently being done by local housing providers in Cork — the proposed development at Horgan’s Quay, in particular, promising a significant boost in housing supply. However, the crisis demands that these efforts be redoubled and this is the time for local initiatives and leadership. We highlight a number of actions where Cork could lead in addressing the housing crisis. Firstly, the extension of the city boundary presents an opportunity to develop land for social housing provision by the city council. This would restore the primary role of the local authority in providing accommodation for low to middle income households, and reduce the unbalanced reliance on private renting. It would make inroads into family homelessness — 93 homeless families including 257 children in Cork and Kerry were housed in B&Bs and hotels in June of this year. Second, Cork should pilot new models of provision such as cost renting which cuts out the developer profit margin and development levies, making housing more affordable and accommodating middle income households. Third, the elimination of long-term chronic homelessness is within reach in Cork city. The extent of this population here in Cork is much smaller than in Dublin. Using a ‘Housing First’ approach — involving the provision of supported rental accommodation for single persons with mental health and addiction issues — long-term homelessness on our streets and in hostels could be solved. Finally, initiatives such as these require a conversation at local level. Local fora such as the housing and homeless strategic policy committees already operate within the local government structure. More broadly, the Cork Evolves initiative explores good housing practice from Ireland and abroad, pitching new ideas and innovations and actively listening to local communities, charities and NGOs. There is no denying the depth of the housing crisis and the challenges it poses in providing homes for our fellow citizens. However, local leadership and initiatives combined with national reforms can make real differences to the lives of our fellow citizens whose housing needs are currently unmet.

This article first appeared in the Cork Evening Echo August 14, 2018. Read here

For more information about research and courses at the School of Applied Social Studies visit here

For more Opinion articles from UCC academics about the housing crisis visit here and here

 

 

 

For more on this story contact:

Ruth Mc Donnell, Head of Media and PR, Office of Marketing and Communications, UCC, Mob: 086-0468950

University College Cork

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