Dr. Ronan Lyons:

It might help to clarify two related but unfortunately competing issues here. One is affordability, which is housing prices compared with incomes. As was said, including in the report, housing prices are high relative to incomes. At the same time, there is a viability challenge, which is housing prices relative to costs. Mr. Flynn is saying that housing prices are low relative to costs and that it costs too much for the market to come in and build. This concerns policymakers and touches on some of the questions that came up earlier as well. Policymakers really need to focus on the cost-to-income relationship, whether it be for social or market housing. They need to skip the housing prices bit and consider how much it costs to build a home. To give the example of Laois, how far up the income distribution would it have to be to make it viable for the market to come in and provide? I suspect if policymakers did that exercise for Laois, they would probably end up in the top third or certainly the top half of the income distribution, which is a crazy situation if we take a step back. It says that only for those in the top third of the income distribution is it viable to provide new housing. However, if we think of it in those terms and consider Professor Norris's point about the provision of affordable social and cost-rental housing and the provision of market housing, it becomes a lot clearer that those two groups need to cover 100% of the income distribution. Otherwise people are being missed in the middle. That missing or forgotten middle is the challenge and how we have ended up where we are today, ten or 12 years into a housing shortage.