Priced out of the capital
Sir, – Brian Boyd’s article (Opinion, August 3rd) should be required reading for our urban planners. He exposes the bankruptcy of existing Government policy based on the naive urban policies of Richard Florida who advocated the “clustering of young creatives and tech workers” which he claimed would bring economic prosperity and the rejuvenation of city living.
However, he hadn’t reckoned on vulture developers who saw rich pickings to be made in these developing urban areas like high-tech Dublin. These unscrupulous profiteers have benefited enormously – and continue to do so – especially from engineered high rents and their relentless drive for exorbitant returns on their property investments.
Mr Boyd rightfully concludes that the group of people being hit hardest and who are bearing the brunt of failed urban housing policies is not the creative community or high-earning tech workers but rather the poorest people with the fewest options who are being forced out of their accommodation onto the margins and inevitably into homelessness. – Yours, etc,
Sir, – Una Mullally’s analysis of the cause of unaffordable housing in Dublin is quite on point – that investors find it more profitable to invest in hotel accommodation for stag-party participants (among others) than normal residential accommodation (“Dublin will fail unless housing crisis is tackled”, Opinion, August 6th).
However, her proposal that people elect councillors who will “prioritise addressing the housing crisis” is not convincing, given the approach adopted by politicians so far. Rather, rowing in with market forces and tailoring those forces might be more effective.
Hotel investors are protected by EU law, in that any efforts to cap hotel-room prices would likely engage the EU Commission to enforce free movement of services or competition law.
Not so with apartment developers, who face the mood music of constant threats of erosion of property rights, via rent-capping.
This is an easy choice for investors. Rent-capping assists with gentrification, and fuels government demand for emergency hotel-rooms, particularly in cold winters when tourist demand may wane.
Threats to cap so-called “overpriced” student-rents (which may also fall foul of EU laws), will also push up demand for hotels rooms, as students out-price rent-challenged renters into homelessness. A downturn in fly-in stag parties may be somewhat desirable, but all markets have tipping points and even the stags will stumble at some stage. A carrot rather than a stick approach should be preferred.
High-quality “market-priced” student accommodation, which can also double as reasonably priced hotel accommodation during summer months, eases demand in two key sectors and cools prices for student accommodation elsewhere.
The fact that such accommodation is taken by better-off foreign students is irrelevant to its market effects; taking any cohort of demand out of a market either reduces prices or eases upward pressures. Solving the housing crisis will require embracing market forces, not seeking to hold back the tide, Canute-style. – Yours, etc,