The Irish Times view on the housing crisis: A broken market
The Government must prepare for an influx of financial institutions after Brexit
Vulture funds are, on average, considering more arrangements for those in arrears when compared to banks and retail credit firms. Photograph: Rui Vieira/PA Wire
Back in 2007, when the Irish property bubble was well and truly inflated, the price per square metre of apartments in Dublin was higher than in Paris. Now, after we’ve been through collapse, recession, austerity and economic recovery, Dublin has been ranked ahead of Paris as the most expensive place for expatriate workers to live by the annual Mercer’s cost-of-living survey of 375 cities worldwide, outstripping all others in the euro zone.
Soaring rents for housing in Dublin, driven by the concentration of economic activity in the capital as much as by the rapacious greed of many landlords, were identified as the key factor in placing it so high in the rankings, in 32nd place – ahead of Paris (34), Rome (46) and Amsterdam (50). By comparison, Belfast is way down the list at 152; unlike in Dublin, housing remains relatively affordable in the island’s Northern capital.
If Christine Lagarde, managing director of the International Monetary Fund, is correct in predicting an influx of financial institutions relocating to Dublin in the wake of Brexit, the Government must surely prepare for such an eventuality. And the most effective response must involve taking steps to ensure that the city’s housing market is fully functional, which it clearly is not, so that a much wider range of options is available.
But it’s not just expatriates whose housing needs should be addressed, but everyone who finds it increasingly difficult to find a place to live at an affordable rent. This must mean taking measures to recover much-needed housing stock from the unregulated short-let market, which has grown exponentially in recent years. An estimated 4,600 “entire homes” are being short-let to tourists via the Airbnb platform alone. Requiring all short-letters to register with the local authorities and imposing a limit of, say, 30 days a year on which any home can be turned over to holiday lettings would almost certainly recover several thousand apartments and houses for long-term letting, thereby catering for locals and expatriates alike as well as helping to drive down extortionate rental levels in Dublin.