Latest statistics from the Central Statistics Office indicate that property prices continue to escalate, showing an annual increase of 8.6 per cent in June. This is largely attributed to a combination of heightened demand and a limited supply of houses, confirming an acceleration in housing inflation observed this year.
The data sheds light on the worrying trend of home affordability becoming increasingly out of reach for many younger individuals. House prices in Dublin saw a sizable increase of 9.3 per cent. Across the country, the cost of both second-hand and new houses continues to rise.
Findings from the Society of Chartered Surveyors Ireland (SCSI) emphasise the growing affordability gap experienced by potential homeowners, even dual-income couples. It’s evident that despite exploiting state homeowner schemes, many people are still unable to afford homes. The majority of real estate agents envisage price increases in spite of the belief that home prices are already inflated.
In relation to these issues, the ideal solution is to increase housing supply. However, prioritisation of housing crisis and push for more completions hasn’t been progressing optimally. This is partially due to governmental indecision and political conflict. There’s a planning bill in the works, but the reform has been taking far too long. Politicians often oppose these housing developments, while coherence to guarantee necessary services like water and power supply to new houses is often missing.
It’s clear that while the provision of more houses is a priority, it lies secondary to not upsetting long-standing voter classes. Government proceedings in necessitating resources for planning and judiciary processes have been inexplicably sluggish. The reluctance of the “system” – comprising politicians and civil servants – to genuinely converse about the Housing Commission report reveals much about the obstructive bureaucratic actions hindering positive change.
Certain strides have been made and beneficial projects have been forwarded, though the rate of progression is insufficiently fast. The void created through the absence of tangible reform has been occupied by an array of programmes aiming to bolster supply and lessen the affordability issue for purchasers. Some of these programmes have seen measured success while others have barely left a mark. Many have given rise to unintended outcomes – the Help-to-Buy scheme, for instance, aided numerous buyers but undeniably also inflated prices. The same could be applied to the amendments made to Central Bank lending regulations in 2023.
For the future, the only solution is addressing the root problems. Political figures may pledge to “furnish” additional tens of thousands of new homes annually, but none will attain success unless the fundamental elements are rectified.