Understanding the Irish Housing Crisis

A housing crisis can be detrimental to the economy of a country. A housing crisis occurs when the availability of affordable housing is rare and you need a higher income to be able to afford a place to live.

 

A housing crisis happens due to a change in supply and demand for real estate. If there are a lot of houses with few people looking, housing prices will drop. Likewise if there are lots of people looking for houses with few properties available prices will go up.

 

The problem with this system is the availability of housing does not have to do with salaries in the area, so when housing prices go up too much and the income does not change it creates a crisis.

 

Digital Mortgages can help people get out of the expensive rental market, allowing them to own property.

 

Why There’s a Crisis

 

Housing is a big part of a person’s monthly budget. For the typical person housing should account for about 35% of their monthly income.

 

When looking at the …

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Promote housing, tax it appropriately and spend that money on making more housing

When you talk about being in favour of ‘more property tax’ you quickly lose the room, but what if we had less income tax and more tax on immovable assets? This is a targeted wealth tax given the way that property and wealth are intertwined, it also means those with the most valuable homes would contribute more and could encourage down-sizing too which would help free up chronically under-occupied housing stock.

This can be an emotive topic, we understand that, but so is the plight of young people facing a market that isn’t affordable and a housing shortage that is driving prices to dangerous levels.

Listen to the full clip here.

 

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The Last Word on Today FM: What about property prices after covid19?

We were guests on Matt Cooper’s ‘The Last Word’ show on Today FM along with Marian Finnegan the MD of SherryFitzgerald’s residential business to discuss the residential property market and how it might work out in the wake of the covid19 pandemic.

Marian gave good analysis as you’d expect, Karl was pointing out that supply shortages would persist despite any changes that may occur in prices, the reasons for this being that the dynamics that existed prior to it hadn’t changed.

The full clip of the piece is below.

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Ireland: Dealing With Crisis

In previous articles, I’ve discussed the ever increasing population of unemployed and homeless people in Ireland, as well as the rising housing prices. At times the two may go hand-in-hand. Higher cost of living could lead to homelessness, and so on. Within the last 12 years, the homeless population has tripled and the cost of living in Ireland has risen to 102% higher than the EU average. These two issues have rooted themselves all throughout Ireland, with no signs of being deweeded. While looking at the issues from an outside perspective may leave you believing nothing is happening to solve these circumstances, the government does have some plans in place to combat said issues. 

The Irish Council for Social Housing (ICSH) is one of the largest contributors to the development of various social housing services. One of their main goals is to “deliver housing and combat homelessness”. The ICSH has already proposed their plan and budget for next year. With funding from the Department of Housing, Planning and Local Government, the ICSH has “an overall package of €2.6 billion to …

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Engineers Ireland Reports on Ireland’s Infrastructure

Engineers Ireland published a report on the condition of Irish Housing and its infrastructures. The findings indicated a lot of trouble down the road if steps were not taken. 52% of the engineers that were polled gave Ireland’s infrastructure a D rating and cited a concern and need for immediate action. Engineers Ireland predicts that over 600,000 people in Ireland are living in unsuitable houses with conditions that include; leaks or damp structure and rotting.

To put into words the current crisis that Ireland is facing, Director general for Engineer Islands, Caroline Spillane said, “We, like many others, are seriously concerned about Ireland’s housing. Immediate actions are needed to overcome challenges in the capacity, condition, and connectivity of our housing stock.” The government has created different projects and organizations to address these issues, but statistical evidence is showing that not enough improvements are being made. Engineers Ireland provides many more solutions to addressing the outdated infrastructure in Ireland.

The first advice that is offered is “focus on retrofitting Ireland’s existing housing stock.” The government has pledged to upgrade 500,000 homes …

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Affordable Home Schemes

With the current housing crisis in the midst of the country, many plans have been developed to get the country out of its current slump. Some merely get laughed at, while others are well on their way to implementation within the housing market. It is likely that before long these effects will take a toll in the market and we will begin to see some upward movement in home buyer confidence.

The government has been quick to release multiple initiatives set out with the goal to turn the crisis around and allow the market to begin looking up. The Home Loan Scheme recently announced by the government is designed with the strategic plan to provide low-cost mortgages to first time home buyers.

With the first announcement of such a plan, many home buyers are thinking; is this too good to be true? As they have been waiting for an extended period of time for some light to be shed on the crisis that allows them to finally move into the homeowner sector.

The Rebuilding Ireland Home Loan …

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RTE: Sean O’Rourke Show, hard to help the homeless 8th May 2018

We were asked to speak on the Sean O’Rourke show about one landlords experience and how the experience left them feeling very negative towards the local authority.

We would believe that in order to remedy our housing crisis, in particular the homelessness element of it, that state power must to work as positively as possible with all of those who are involved including landlords. Serving a notice of a €5,000 fine and threats of prison for minor infractions is not part of how that comes about.

Dublin City Council have turned the landlord in question diametrically against helping more people in homelessness in the future. If this pattern of behaviour is repeated again and again across the city it is no wonder that helping people out of homelessness has become such a slow process.

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Today FM: Varadkar comments on housing deposits discussed

We were on Today FM to talk about comments made by the Taoiseach regarding how people come up with money for a deposit to buy a home. While many were finding it a source of outrage, we were making the point that it’s incredibly common and that it actually is a normal occurrence albeit not ‘the norm’ for everybody (because nothing is universal).

This is a good discussion because in our view it shows the way that housing shortages can turn into all manner of talking point arguments, we don’t think it’s realistic to tell parents you can’t help your kids or to say that it’s wrong in any way, but we do agree with Sinead from TheJournal that we have a housing shortage and that this is really where the problem lies.

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Today FM ‘Last Word’ speaks to Irish Mortgage Brokers, 27th April 2017

Matt Cooper had several guests in to discuss the new proposal for 800 sites owned by the government to be released in order to provide new housing.

There was  Jim Bainam from the Department of Housing, Karl Deeter from Irish Mortgage Brokers and Sinn Fein TD Eoin O’Brionn.

There were differences of opinion in terms of the ‘how’ regarding the sites, in terms of ‘how they are delivered’ via housing bodies, local authorities or privately, but all of the panellists were positive about a move to increase housing supply.

The main thing to remember in our view, is that it doesn’t really matter who builds what because the local authority remain the tax authority on all housing so they can get the housing with no capital outlay and then capture the property tax in future years if a private developer does it.

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Generation Rent? Try generation Broke

It bothers me when people promote long-term renting as a better choice than home ownership because it belies some basic facts.

When I was studying accounting, I was taught to be accurate. When I was learning about financial advice, I was taught to be prudent. Yet both of these concerns are often cast aside when debating the benefits of buying versus renting.

Nationally we are at an important juncture. It’s acknowledged that huge numbers of people won’t be able to afford to buy a home. If this proves to be true, many will also be locked out of one of life’s most wealth-creating activities.

The first problem is the nature of the comparison. If rent is €1,300 a month and a mortgage costs €1,500, then it’s cheaper to rent, right? Well . . . no it isn’t. The outlay is less, but the actual cost of the provision of occupancy is the rent versus the interest portion of the mortgage, not the entire payment. I will explain that point.

People often say rent is dead money. To be fair, so …

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