The housing crisis
Sir, – Much has been written about the housing crisis and solutions are trotted out on a daily basis, most centring on common themes: build more, build higher, build faster, but not in my back yard, freeze rents, tax the small investor, offer the large investor incentives to build, build in Dublin, build outside Dublin, and so on. Each silo produces its own “innovative solution”.
The housing market – and that is what it is, for property is a tradeable for-profit commodity, from which far too many public and private stakeholders have vested interests – is the most misunderstood market we have. A homeless person has a fundamentally different need to a couple unable to buy in their preferred location.
Until society recognises that housing is a social good, for all of the common good, and a shared responsibility, all else is just noise. – Yours, etc,
Sir, – The cobra effect occurs when an attempted solution to a problem makes the problem worse.
The story goes that at the time of British colonial rule in India, the British government decided something must be done about the number of venomous cobras. To tackle the problem, they offered a bounty for every dead cobra handed over by the people.
Initially it was a success and snakes were being killed for cash in large numbers. However, because of this bounty, the enterprising people of India began to farm cobras as a means of income.
When the British got wind of this, they scrapped the plan causing the cobra breeders to release millions of now-worthless snakes back into the wild and the cobra population rose further. People respond to incentives.
On the surface, rent control might seem like a reasonable policy to reduce homelessness. However, it is more likely to make the problem much worse.
To reduce homelessness, we need to increase the supply of homes. It is the only real solution that is proven to work. We cannot expect to increase the supply of homes by reducing the financial incentive to build them. It doesn’t make any sense.
Freezing rents may temporarily benefit people who already have homes (though the data is grey), but it will certainly hurt people who need homes. It will cause resources to shift away from housing and the homeless population will rise further. – Yours, etc,
New South Wales,
Sir, – I note that the State’s biggest landlord collected €62 million in rents last year (“Ires Reit to build 600 apartments despite political uncertainty”, Business, February 21st).
It then states that it will press ahead to build another 600 apartments, despite concerns that a possible rent freeze might come to pass .
If ever there was a case for such a freeze, then surely the above obscene figure does just that! – Yours, etc,