Oireachtas Joint and Select Committees

Tuesday, 10 May 2016

Committee on Housing and Homelessness

Professor P. J. Drudy, Trinity College Dublin

10:30 am

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance) | Oireachtas source

I agree generally with his concept of what rent controls or regulations should be. They have to be in some way linked with inflation.

If we froze rents it would not end the problem; we have to reduce them. In parts of Dublin, rents are between €1,400 and €2,000. I agree with those who said rents are having a massively negative impact on the economy and I cannot understand how this is not grasped by the Government. It is not just about people in social housing or on the social housing list. No matter how many times one says this, one is often accused of not caring about people who do not qualify for the social housing list. The latter probably constitute the biggest group. Even if people meet their payments, just think of a young family paying €1,400 in rent every month. This has an impact on the children because the family cannot spend money on them. I refer, for example, to paying for things such as dance lessons, sports and things other people take for granted. Many children suffer in the way outlined and there is a strain on families that are obliged to pay this amount every month.

I know many migrants who came to this country but who have since left. They have gone to Britain and other places because they simply cannot understand how nothing is being done about this situation. We have a very big migrant population in west Dublin. They are stuck in the private rental sector and are more prey to becoming homeless.

I have questions on a number of the issues raised by Professor Drudy. He mentioned the debate engaged in by the Government on rent controls or rent regulation, to use another term. He made the point that he believes this was down to pressure exerted by vested interests. He gave several examples, including that of a US company which now controls a huge part of the rental market. Will he expand on that? Is he stating that this was the main reason the previous Government did not introduce the type of rent controls that everybody who is suffering knows are needed, rather than the legal or constitutional obstacles cited? He gave credit to Deputy Kelly, and I am not arguing about this, but the latter came here and argued there were legal reasons and stated we need a grown-up conversation about Article 43 of the Constitution.

Professor Drudy made many points on house prices and rents. Some of the figures relating to the increase in house prices throughout the country are both shocking and very useful. I refer to the fact, for example, that in Dublin the ratio of house prices to average earnings is now 9.3:1, which is shocking. How can anyone afford to buy a house, even people with relatively good jobs and certainly those on the average industrial wage? So much for our great attachment to homeownership. Will Professor Drudy expand on why house prices and rents have increased so much? How much of this is due to profiteering? The reason I raise this is that on foot of the committee's findings, I am sure some house-building will be commended. However, I am concerned. As others have alluded to, we need councils to directly build housing because much of the profiteering in the cost of a house is due to private developers. There would be no guarantee that such developers would provide affordable housing.

Professor Drudy stated that he welcomes the fact the Government will build 35,000 houses over five years, according to its Social Housing 2020 programme, but, unfortunately, it will not actually build 35,000 houses. It is important that people know this. Even if these new houses were being built, it would not be enough. During the boom, 80,000 houses were built each year. The idea we must do it at a piecemeal pace would mean people would wait ten years for a house.

I am not saying that we should build the wrong estates, but we must have a sense of urgency. I will not go into the matter. However, most of the 35,000 houses are social housing units that have been acquired in recent years through, for example, HAP, RAS and so on.

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