Mick Wallace (Wexford, Independent) | Oireachtas source

I wish both Ministers good luck. They will probably need it. It is not an easy job.

Someone from Gorey contacted me recently to explain their situation. The maximum rent supplement for a couple or one-parent family is €530 and it is €565 for a parent with two children. The cheapest available accommodation on daft.ieis €760 and the next cheapest is €825. I realise that if the rent supplement in increased the landlord will probably raise his price as well. I am the first to admit that it is not an easy problem to solve. A number of challenges face the Minister in the long term, and partly in the short term.

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These include homelessness, high rents and lack of affordable housing. In the long term, the Government will have to change its philosophy if it is to work for it. In the report the Minister states that last year 5,724 social housing units were built, refurbished, leased or acquired. In 2016, 200 were built and 37 were delivered through Part V. This will not solve things.

Many of the Minister's problems today around homelessness, lack of affordable housing and high rents are linked to the fact that since 2011 we have allowed things to continue to get worse. Real estate investment trusts, REITs, and the vulture funds have availed of a wonderful scenario. Prices were discounted for them, there was no credit available for the Irish to buy, home ownership was dropping and rent demand was going up. It was a perfect scenario that has brought us to a point where Irish Residential Properties REIT plc, I·RES REIT, is now advertising one-bedroom apartments to be launched soon at €1,900 a month. The system is broken. High rents lead to evictions which lead to homelessness which leads to an extra cost to the State. It is not rocket science.

NAMA is talking about supplying 20,000 units. Some 18,000 of them are to be supplied at approximately €360,000 each, with 2,000 available for the social end. Last year Dublin City Council claimed that it could supply houses for €205,000 each. With inflation and other rises, let us call it €230,000 today. A house can be supplied for €230,000 in Dublin. It is State land, but so is NAMA's. It belongs to the people. However, NAMA's price is €360,000. The difference is €130,000. NAMA is not building houses at an affordable price, and often there is a developer involved and the price is not dissociated from the market price which involves a land banker. In that case of the land banker and the take from the investor-developer, we are looking at a difference of approximately €130,000. Where is the logic in that? Why would we allow this private sector to make an extra €130,000 on 18,000 units? If the Minister did nothing else in his time in the Department but change NAMA's remit and get it to supply 50% social housing and 50% affordable housing, it would make some impact. It can be done. If the Minister asked me to build those 18,000 houses on State land and told me that he would give me €230,000 for every one of them when they are ready to be moved into, I would take the hand off him because I would make lovely money. I guarantee it. There is no logic or rationale in NAMA selling 18,000 houses on State land for €360,000 each when we have a housing crisis. It does not make any sense.

From the day I came in here in 2011, the State has been depending on the private sector to solve its housing problems. Right now Cairn Homes and Hines control more than 20,000 units with permission that are ready to go in the Dublin region but they will not even build 1,000 of them this year because it will not pay them. I would not shoot them. Their job is to make money. The people that disappoint me are those who do not address the problem, that is, the State. The Government must play a different role. Tax them for banking the land. The Government cannot force them to build, but the Government is not taxing them for banking the land. At the moment, when the price of a house goes up 10%, the price of the land that they are banking is going up a minimum of 30%. From an economic point of view, they would be foolish to build at the moment.

Principle number one is that the State should stop depending on the private sector to solve its housing crisis. We have a serious problem in how we supply housing. The answer lies with the State playing a hands-on, active role in ensuring that housing is supplied on its land at affordable prices.

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