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Threshold comments on Central Bank analysis

10 December 2019

Responding to Central Bank analysis today which claims that 34,000 per annum will have to be built in Ireland over the next 10 years to meet demand, CEO of Threshold, John-Mark McCafferty said: “The incremental increase in housing output which we have seen in recent years is too slow for people who need secure, long-term homes. An increase in supply is vital; however it is just as important to consider the type of supply. In our pre-budget submission we called for more diverse housing options beyond owner-occupation, private rental and social housing.

 

"The government has an imperative to lead on this as the market will only provide housing where the greatest profits are to be made. Such profit motivation is not compatible with the values of affordability, security and sustainability and does not guarantee access to a home. Unfortunately, the government plans to only build 33,500 homes over five years as part of the Social Housing pillar in its Rebuilding Ireland programme. This is a mere 24% of the total planned social housing provision. The government expects the remainder to be provided via the private sector in the form of properties for purchase, rent or long-term lease. We acknowledge and welcome announcements for affordable purchase; however, progress to date on this as well as affordable rental has been slow.

 

“The majority of us are seeking our ‘forever home’. In our Tenant Sentiment Survey, carried out in 2018, tenants told us they were not renting out of choice: they rent as they cannot afford to buy, cannot get a mortgage or cannot access social housing. The majority found it difficult to find a rented home they could afford.  These sentiments were echoed by the HAP tenants we surveyed this year and in research published by the Irish Government Economic and Evaluation Service in 2019. Tenants’ vision of a ‘forever home’ is one that offers security, sustainability and affordability.

 

“Long-term, secure, affordable social housing options must exist alongside such profit-driven private developments and the government must demonstrate leadership in the provision of these options. It must develop housing for our sustainable living into the future; to ensure we all have a home in which each of us can achieve our potential. This will only be achieved through an increase in traditional social housing built by local authorities and AHBs as well as new forms of provision such as ‘cost rental’. Research shows that countries in which a greater share of the housing stock is held by government bodies and AHBs have smaller differences in housing quality between tenures; smaller differences between private and social rents; and limited residualisation in the social rental sector. The Netherlands, Denmark and Austria are examples of such countries. In these countries between 20% and 32% of all stock is owned by government and/or AHBS; in Ireland only 8.5% of housing stock is owned by the local authorities and AHBS.  Ireland has been criticised by the European Commission for its lack of affordable housing, cost rental options, insufficient supply of social housing and the use of HAP. Increasing the AHBs and LA ownership of total housing stock to 20-25% will greatly increase access to secure, good quality, affordable and sustainable housing in integrated communities and will future proof our housing sector and society.”

 

Aideen Hayden, Chairperson of Threshold commented: “The shortage of supply and the increasing backlog is critical for the future of housing in Ireland. The actions of previous governments of all hues in failing to deliver social housing from the early 1990s onwards has left us with no backstop when the economy either rises or falls. We are now rowing from behind which has resulted in a whole decade of Irish people either being excluded from affordable purchase or relying on expensive and insecure private renting with little or no social housing options. What is needed now are extraordinary measures and a national discussion on how we can tackle this. Such a discussion may be uncomfortable for some but there are so many aspects to this crisis that only a national consensus can solve it.”