Oireachtas Joint and Select Committees

Wednesday, 21 June 2017

Joint Oireachtas Committee on Housing, Planning, Community and Local Government

Housing and Rental Market: Discussion

9:30 am

Mr. Mike Allen:

I hope it was not me. So to some extent then we are in a situation where in an immediate sense the crisis of homelessness is in the private rented sector. Obviously, I hope it is now well recognised that the fundamental problem is in our failure to deliver affordable and in particular social housing, but the problem is expressing itself in the private rented sector. The question of to what extent housing units which could be privately rented are moving into Airbnb or other platforms for short-term letting is extremely important. We struggle day by day to find places for people to stay. All of our organisations invest substantial funds, including public funds, in buying and owning new property, so if we are leaking property elsewhere it is extremely important.

It is striking then that there is a very little data on this. The absence of data highlights part of the problem. It is not just this area on which we lack data. Every area to do with housing and homelessness, other than the number of individuals who are homeless is highly contested - for example, how many houses were completed; how many houses were started; how many houses are vacant and why they are vacant. The absence of our knowledge about the housing sector says something about the way society has dealt with housing and why we currently have a homelessness problem. Probably the most reliable data one can get is from the Airbnb website, which gives some clear indications about what is available but its is very clear about its limitations as a data source. It always increases one's confidence if a website tells one why one should not believe in information it contains or what its limitations are. It has a figure of 457 full buildings which are described as highly available. If a building is highly available it is probably not being used as a home. At the very least, that is the number of housing units which would otherwise be in the private rented sector if they were not being used for Airbnb. There are also very striking figures on the website about the money one can get from Airbnb as opposed to what one would get in what is already a very inflated private rental market. In particular, if one is not paying tax on it, it shows that it is very attractive to go on Airbnb. Some of those details are outlined in the paper and some of the limitations in the data are also clearly indicated on the website. I will not go into that detail.

Focus Ireland's analysis of the situation is that Airbnb is absolutely not the cause of our homeless crisis. Some of the more extreme commentators have said it is the cause but that is not the case. It is a service that makes a valuable contribution both to tourism in Dublin and elsewhere, and also to household income. We have got to bear that in mind. What we have here is a disruptive form of business entering into an extremely regulated sector. We have had piecemeal regulation and no coherent strategy on regulation in the private rented sector, which is felt to be onerous by landlords and insufficient by tenants. Entering into that is a disruptive new web-based, free market process which is completely unregulated and, inevitably, it will cause enormous difficulties. The response to that is wider than Airbnb but it is a question of how the State struggles with such web-based, regulation-free interactions. Each individual who is letting out his or her place for B&B feels his or her action is entirely justifiable and there is no negative consequences, but when looked at en massehas very severe significant social impacts.

I believe Airbnb is coming before the committee next week. The fundamental thing is that as a highly profitable enterprise it behaves in a very socially careless way at least. Like all companies that rely on data, it treats the data it gets from private citizens as an asset of its organisation and does not share it with public authorities who need it in order to understand the implications of its behaviour. That is one of the fundamental things the committee needs to challenge. I do not know what can be done under Irish law to get the company to share information that is reliable but one cannot have regulation without data. The only way it appears one can get data other than from such companies is by employing a significant number of inspectors, who operate from the grassroots and try to clarify the situation. One will see examples of that being done in Barcelona and elsewhere.

While Airbnb is not the cause of the problem it is a significant part of the picture in terms of being a contributing factor to making it worse. If we take that minimum figure of about 450 complete housing units, which are more or less completely dedicated for use on Airbnb, it would cost €900 million for the State to provide those 450 housing units. That is a fairly substantial part of the State's investment in social housing. If Focus Ireland and the other organisations here had access to 450 housing units for families we would be looking at enormous savings in terms of hotel costs and it would result in the transformation of the lives of large numbers of families so this is having a very significant impact at the moment. There are things that we need to do now in relation to regulation and control because we are in the middle of a crisis, which may not necessarily be the things one would do in a normally functioning housing market. When we call it a crisis that is the implication of what we are saying. That needs to be looked at.

What is striking about the situation is that some cities are very much gearing up to this problem and are learning lessons about how to regulate the situation. There seems to be no visible sign of cities across the globe who are all facing the same problems sharing experiences, sharing knowledge or networking to create responses. We would very strongly recommend that it is part of what should be done. In the absence of data it is very hard to be more specific than that but we would very strongly recommend that the next stage of the committee's programme should be to try to bring together what data are available, but that needs to be done extremely quickly because this is a problem of the now rather than a long-term think-in about how we deal with the web-based provision of services, which are now being completely deregulated by the Internet.

Sr. Stan of Focus Ireland has regularly spoken about the commodification of housing and how we need to see housing not as a commodity but as part of the fulfilment of a human right to housing. Airbnb and the taking of housing units for which planning permission and probably public subsidy existed to provide them as homes and putting them on the market to be sold off in this way is an absolutely perfect example of the commodification of a scarce resource, which is essential to fulfil our human rights.

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