Paul Hosford: Darragh O'Brien must stop going around the houses if he is to tackle crisis
Housing Minister Darragh O'Brien is working to advance the Affordable Housing Bill. File Picture: Eamonn Farrell / RollingNews.ie
There are few people — aside from tens of thousands of people looking to own a home, the Government, and many facets of the economy — who have a greater interest in solving the housing crisis than Darragh O'Brien.
When Fianna Fáil sought the twin ministries of health and housing in the midst of crises in both, it was a swing for the fences that tied the party's future and the political legacies of Mr O'Brien and Stephen Donnelly to how the next two years pan out.
And Mr O'Brien has been busy, working to advance the Affordable Housing Bill, which was brought to Cabinet on Tuesday.
The bill hopes to deliver up to 6,000 affordable homes on State lands within four years, as well as adding 414 new cost rental homes this year and introduce a shared equity scheme targeted at first-time buyers.
While each of these interventions in housing is welcome, they came as Mr O'Brien had admitted on radio that delivery of housing this year will be less than half of that which is needed.
With the Department of Housing aiming to see 33,000 homes built a year by 2025, Mr O'Brien told RTÉ radio that this year will see fewer than 15,000 completed.
But, Covid aside, that would still leave the country 8,000 homes shy of the bare minimum. This also came as it was revealed that 135 of 170 homes at an estate in Maynooth had been snapped up by an American investment firm —not a great look for a minister who has repeatedly said he believes in homeownership.
While the Affordable Housing Bill is not designed to be a silver bullet — and the minister is very keen to reiterate this point — it is a major piece of legislation for the Government that comes with a couple of key concerns, chief of which is the Shared Equity Scheme.
While Mr O'Brien argues that this will form a very small -1.5% — part of the overall mortgage market, it has garnered huge attention amid concerns from the Central Bank and ESRI that it will raise house prices.
Faced with a decade-long affordability gap for a cohort of first-time buyers, the Government's answers have been the Help To Buy (HTB) Scheme and now shared equity.
Each has one thing in common — they artificially decrease the price paid by the house buyer but do little to tackle the overriding issue of affordability and there is little evidence the former stimulated housing supply.
The measures are welcome by the people who avail of them, but figures show that 40% of the 22,000 HTB recipients had the means to buy their homes and the ESRI last year warned it had actually increased prices.
The Government mantra for a decade has been supply, supply, supply and it is obvious that by addressing many of the bureaucratic and structural issues in the market, the current minister believes that by clearing many small logjams, he will free up a glut of homes which will push down prices.
However, without addressing the cost of building homes or taking steps to deliver homes en masse in the short-term, the self-styled party of homeownership will face another tough time as it goes around the houses.
