No Single Solution to the Imbalance in the Housing Market
“How do you intervene in a market that is out of balance? We have a lot of policies but implementation is vital,” remarked David Duffy, Director of Property Industry Ireland, the Ibec group that represents the sector, when assessing the issue and challenges facing Ireland’s housing market, where the growth in supply is lagging behind the growth in demand. “The huge supply/demand imbalance needs to be addressed,” he added, while speaking at the recent 2018 National Construction Summit in Dublin.
“The housing market is very complex,” he said. “There is no silver bullet or single reform. There are a range of measures which need to be taken.” The affordability of housing has become a major risk to the country’s competitiveness and is now an economic issue.
On the supply side of the equation, David Duffy, pointed out that policy certainty is required for developers. The construction sector is currently facing a shortage of available labour. While the overall employment level has returned to close to the peak before the economic crash, this has not been the case in construction. “Many construction workers have emigrated,” he said, “and the ’crash’ has coloured people’s vision of construction as a career. The industry need to tackle this.” He added: “The sector is already experiencing resource constraints.”
The National Planning framework is important in order to look ahead at how the economy will function in 2040 and to prepare for this scenario, by, for example, examining the type of housing stock that will be required and where it should be located, while also preventing urban sprawl.
He cautioned that new housing will take time to deliver with an 18-24 months build period required. While new build will help speed up supply, other ways of increasing the overall housing stock need to be examined, such as making better use of existing properties.
“We have to look at the entire market and a variety of solutions.” He elaborated: “We are not trying to find one solution but a number of solutions that will work together.”