Political Ineptitude and the ongoing Crisis of Housing
Houses for the most part, are simple structures and quick to build.
Mass housing is just an assembly of ready-made components..........a form of Lego for adults! So any crisis of housing has nothing to do with the logistics of construction......but has everything to do with national legislation, national infrastructure and the political environment created by governments.
In Ireland, Governments have a particularly poor housing record, due to the corrupt system of
brown envelope politics which was allowed to flourish and, which dominated the industry in years past.
Many proposals for change have been presented to Government, including the Buchanan Report of 1968.
But little of substance has been done to change the political culture.
And it is an unreformed political culture which is at the heart of any housing crisis!
Land ownership, land use and a fair taxation of this asset class, is at the heart of the problem.
In an Irish context, a fair balance between private ownership and public ownership makes sense! Wholesale nationalization is not being proposed as a solution. However, the crisis in housing can be directly linked to the private ownership of small pockets of land with inflated value. Inflated because of a perceived windfall gain if planning permission can be obtained.......a perception that goes back to the brown envelope era!
Planners are employed by Local Authorities and the State to forward plan infrastructural services including; public transport, roads, water, sewerage, schools, hospitals, recreational facilities etc. Only when these services are in place, should the process of developing tracts of land for public and private housing begin.
Zoning tracts of land is the responsibility of Planners employed at the expense of the public. Any financial benefit should therefore accrue to the Public Purse.
It makes little sense (except to politicians, who have their own reasons!!) when privately owned farmland valued at €12,000 per acre, suddenly increases in value to €1,000,000 acre. A process which is supposed to be at the discretion of Planners, who are deemed to be servants of the Public.
Under Successive Governments, the very same Public are then exploited and, forced to pay a highly inflated site price for any house they wish to purchase. A site price often "valued" in the hundreds of thousands of Euro!
And that in a country awash with untaxed and underutilized land, particularly if calculated as land area available on a per-capita basis! A lot of potential building land, for a small population of 5 million people!
The scandal of inflated land prices.
The nonsensical level of unearned and undeserved private profit from Land can be avoided, if larger blocks of land are assembled and taken into public/private ownership at market value, prior to re-zoning. Assembled Land can then be made available on long-term lease to housing societies and housing developers. Future increase in Land Value then accrues to the State and not private individuals......And it is The State that desperately needs capital to fund and improve infrastructure.
Building Permit Charges
In other jurisdictions, Zoning Density and Building Permit Charges are scaled according to distance from good infrastructure, such as commuter rail stations. People now expect and are willing to pay for public services. Particularly when these are provided close by, within walking/cycling distance.
Excellent community housing built by private enterprise
During the Industrial Revolution, factory and mill owners built mass housing to attract their workers and then charged manageable rents. The many examples include: Bournville, Port Sunlight, Saltaire and New Earswick.
Today's multi-national companies could again provide accommodation for their workers. Once there is a guarantee of take-out, large house building companies could easily raise low-cost finance and start building for let.
Mass housing could also be funded at low rates by life insurance companies etc. as a matter of course, subject to changes in Legislation requiring Government Approval.
Rent control is another useful tool. Even in the heart of American West Coast Capitalism, cities such as Santa Monica have rent control, in order to provide the working population with a place to live.
Nothing is impossible.........but a solution to the housing crisis does require a complete change of Government mindset!