Expert says State needs to build 1.4m extra homes by 2050 to meet demand
This equates to 49,000 new units a year for 30 years
The State needs to build an additional 1.4 million homes over the next 30 years – equivalent to 49,000 units a year – to cope with the likely increase in population, one of the State’s leading housing experts has claimed.
Economist Ronan Lyons said the Republic’s population is expected to grow from 4.9 million now to between 5.6 million and 6.7 million by 2051.
Taking into account changes to household size and obsolescence of the existing stock, “we’ll need something like 3.1 million dwellings by 2050” to accommodate this increase, he told the annual conference of the Dublin Economics Workshop.
There are currently 1.7 million occupied homes in the State.
Based on an average household size of 2.1 persons and an annual obsolescence rate of 0.6 per cent, “you end up needing about 49,000 homes per year”, he said.
Depending on the policy preference, up to 20,000 of these additional units could come via social housing, he said.
The forecast for anticipated housing demand is considerably higher than the 25,000 target set out in the Government’s Project Ireland 2040 plan, and more than twice the current level of supply, which was 21,000 last year. This is expected to fall to between 14,000 and 18,000 this year as result of Covid-19.
Mr Lyons said the bulk of the new homes were needed for smaller households and in urban locations, noting that the State had missed out on the big apartment building projects of the 20th century seen in other EU countries.
He also said supply was the single most important factor in determining affordability. “The more homes that are available the more prices fall.”
Mr Lyons said there was a cohort of prospective buyers that found themselves too well-off to qualify for social housing but too poor to buy at current market rates, and solving the needs of this group was crucial to resolving the State’s housing crisis.
Also speaking at the event, Sinn Féin’s housing spokesman Eoin Ó Broin said the private development model, which the State relies on for its housing needs, was “broken”.
“All of the evidence pointed to the fact that private developers cannot deliver genuinely affordable homes for certain cohorts of people, and therefore we should stop asking them to do so.”
He said the need for a counter-cyclical investment to boost employment in the face of the pandemic and the availability of low-cost borrowing provided an opportunity for the new Government to invest heavily in critical infrastructure such as housing.
“Public demand for real policy change and genuinely affordable rental and purchase accommodation has never been greater,” said Mr Ó Broin.
He said the State was not investing enough in affordable homes to rent or buy, and Government proposals for a new share equity scheme to help buyers bridge the affordability gap “simply locked in higher prices”.
Michelle Norris from University College Dublin’s school of social policy said a greater level of social housing provision was key to addressing the problems of affordability and supply.
Social housing is 24 per cent of the total housing stock in Austria, compared to 15 per cent in the Republic.
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