If Simon Harris becomes the next Taoiseach, to be elected by the Dáil, he will undoubtedly be confronted with the profound housing crisis affecting the nation, made evident by recent statistics. Current data from the Central Statistics Office confirmed the ongoing increase of prices in January, which surged by an annual rate of 5.4per cent, a rise from the 4.1 percent in December. Interestingly, the surge in house prices was more noticeable outside of Dublin as compared to the city itself. Markedly, newly constructed homes witnessed an increase of 9.2 per cent, a vast divergence from the 1.6 per cent rise for existing homes.
The surge in prices is making housing progressively inaccessible for numerous prospective homeowners. As a countermeasure, the government has rolled out several aids, including the First Home scheme and the Help-To-Buy initiative. Some of the price hike for new houses can be attributed to these initiatives, although increased costs have played a considerable role as well.
While current homeowners may benefit from price surges, potential first-time buyers are likely perturbed by the situation, especially for those considering the First Home Scheme, who need to reassess the scheme’s long-term functionality in case house prices drop.
Moving forward, efforts are being made to ramp up the supply of new homes, with the Department of Housing indicating robust commencement data for February. Some newly built homes are slightly more affordable due to state schemes, which paradoxically makes it challenging to terminate these programmes, even though the ideal long-term policy would ideally attempt to decrease construction costs rather than amplifying demand.
The housing dilemma will undeniably be a driving force in the impending general election debates. It is crucial that the electorate receives a comprehensive understanding of not just the objectives each party has set for residential construction, but also the designated route to achieve these goals. There are a multitude of challenging decisions that need to be made, beyond just the demand-related schemes; the broader domain of housing, where considerable state funding is being allocated, demands it.
This trend of state investment into housing will persist, as it very well should, but its effectiveness in serving the public interest is paramount. The most politically arduous aspect is that the fruition of housing policies only emerges in the long haul. Previous trends have indicated that it takes considerable time to accelerate housing construction, and this would need to be further amplified to meet the demands of a growing populace. High building costs and a lack of skilled labour are hurdles that the ruling party will have to surmount, irrespective of who is in power.
Instant solutions remain elusive; pretending otherwise would be unwise.