Housing for ‘Once and For All’

It will take time to absorb the myriad of measures contained in the Government’s recently published Housing for All report and the likely implications and consequences of same, writes Marie Hunt, Executive Director of CBRE Ireland.

While the full detail is still forthcoming, the Government is to be commended for allocating significant funding towards housing and producing a comprehensive set of proposals, to once and for all attempt to tackle the housing crisis this country faces.

Unlike many of the plans that have been produced previously, this needs to be a plan that is implementable. We now need to draw a line in the sand on government intervention and policy changes as we are in very real danger of losing the trust (and patience) of the very developers, funders, investors, and other intermediaries that we are relying on to deliver the end product if we can’t provide certainty on housing policy.
Over the years, as several governments and many different housing ministers took on the challenge of ‘fixing’ the housing problem, there have been countless different proposals and measures introduced, many of which were implemented without sufficient industry consultation, which meant that they had unintended consequences or failed to deliver and were subsequently removed. In the last decade, we have seen a plethora of changes including several changes to stamp duty, capital gains tax and mortgage interest relief. We have seen the introduction of residential property tax; Part V legislation to deliver social and affordable housing; the Living Over the Shop scheme; the Help to Buy scheme; vacant site tax; Rent Pressure Zones; an 80 per cent windfall land tax; changes to the planning code on apartment sizes and the introduction at one point of a two-year planning rule. Some measures didn’t have the desired impact with many removed or changed significantly following implementation.

This summer it was unexpectedly announced that the 4 per cent rental cap that has been in place in the residential sector for the last number of years was to be replaced with a system whereby rents will be linked to inflation going forward. Within weeks, there were calls on the Minister to amend this measure on the basis that inflation is currently higher than it has been historically. Trying to attract and retain developers, investors, and funders (that we are reliant on to help deliver the end product) to commit to developing housing when policy keeps changing and current policy is regularly in the process of being replaced with something bigger and better, is extremely difficult. We need to ensure that policy is easily understood and implementable but more importantly we need the Government to have the courage of its convictions and give assurance that policy is consistent. All of the various stakeholders are tired of the rules being changed half-way through the game not to mention the fear of them being changed again before the full-time whistle.

The Government has put months of work into producing this new multi-annual plan. The intention is good albeit the plan is unlikely to result in a meaningful improvement in housing supply in the short-term. Arguably, the situation will get worse before it gets better. Hopefully, in time the plan will provide housing for once and for all.

Marie Hunt
Executive Director, CBRE Ireland

T +353 1 618 5543
M +353 87 272 7115
E: marie.hunt@cbre.com
W: www.cbre.ie