Addressing Ireland’s housing crisis


Sir, – Your reader David Clavin’s letter (June 27th) on house buyers being grateful for bank regulations is perfectly correct regarding much of what he says.

My own comments in a recent speech were somewhat truncated when reported. In addressing the issue I did so as follows:

“To me, the political system and particularly the Central Bank, when it comes to housing policy, are so transfixed on avoiding the beast of capitalism they seem unable to utilise, for the public good, the genius of capitalism. The unfortunate side-effects of this are lack of housing output, unacceptably high rents for our precious young people, which is stopping our people and our country from reaching its potential and also adding stress to the lives of so many individuals.

“It’s acknowledged that people can afford to spend 30 per cent of their income on mortgage payments, particularly as their careers grow, but they’re not being allowed to by the Central Bank and this is limiting demand. Our colleague, David Duffy, (in Property Industry Ireland) has done some very interesting work in this area which he will shortly publish. The macroprudential rules in themselves are to be welcomed and to be kept but as currently constituted they are too binding. Couple that with nearly 55 per cent tax on small private investors and a deluge of often needless compliance and you get a perfect storm of limited supply and spiralling rents. It’s time to shout stop!

“Paschal Donohoe has a challenge on his hands in the next budget to rectify one part of this problem – the taxation of private landlords. He also needs to reduce VAT on construction. The macroprudential rules really make this essential. The minute our new Central Bank Governor, Gabriel Makhlouf, lands at Dublin Airport, the man or woman at Passport Control needs to tell him he has a broader job to do than he perhaps anticipated!”

Undoubtedly having a proper long-term social housing policy is part of the solution to Ireland’s housing crisis, but we also urgently need to increase private housing supply by improving viability while managing capital values. It is quite a task.

I do not believe we can respond to this challenge without much more collaboration of an appropriate nature between the public and private sectors. – Yours, etc,



Sherry FitzGerald,


Dublin 18.