Dáil debates

Thursday, 24 June 2021

Affordable Housing Bill 2021 [Seanad]: Second Stage (Resumed)

 

5:10 pm

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael) | Oireachtas source

The Ceann Comhairle and I have learned a lot about housing over the years. We have put many of those things into practice in our own constituencies over the years, and they worked. However, approximately 20 years ago, the emphasis on the right to own a house fell away. A great deal of emphasis and advertising went into the glories of renting and how wonderful it is to rent. Even in recent years, it was not unusual for someone to come on "Morning Ireland" to tell us how wonderful it was to rent. That was never the case. Renting was always a way out of housing, a way to make it impossible for people to own their own houses.

We all know that affordable housing is part of the taxation system in this country and always has been. If people were able to afford a house, they were able to plan their lives and work without having to go back to their employers or the public service every three or four months looking for a pay increase. They had stability. We were able to solve any issues because we did something serious about them at the time. We did that in a number of ways. We built local authority housing. We provided annuity loans and housing agency loans through the 1966 Housing Act. Those loans were excellent. They applied a principle of two and a half times the income of the main earner and, later, included the income of the second earner. It worked extremely well. It meant there was latitude there for borrowers in the event of something going wrong, for example, somebody in the household becoming ill. It meant a family would be able to survive because they were not overborrowed.

Wise people then came along to lead us in a different direction and told us those ideas were old-fashioned, that we should change all that and have a formula. People were then loaned up to ten times their incomes. That was a crazy situation and, of course, when the crunch came, they were the people who were hit first. I am sure the Ceann Comhairle and everyone else in this House dealt with cases when then crash came. The people who were way over that two and a half times their income limit when they got their mortgages in the first place were the first casualties. It was sad to see many people, poor families, being hammered in a way that was totally unnecessary. There was no need for them to be led astray in that fashion.

I listened to Deputy Ó Cuív who has the experience of having lived and worked with these sorts of situations over the years and he has learned from them. What he said was true in that we need to get it right this time because there will be no second chances. The public are depending on our ability to deliver. That means we must deliver big time in the first instance. It is no good telling people that in five, six, seven or ten years, we will have houses for everybody. The children of today will be adults at that stage, and long since past caring whether they ever get houses.

In 1992 and 1993, people were leaving this country and emigrating. There was a shortage of housing then in the same way there is now. People emigrated because they could not get houses at home. People were sleeping on floors. The parents of emigrants who returned from abroad were sleeping on floors because they had nowhere else to go and it was not possible to deliver housing in time.

I believe we are only tinkering around the edges of the issue. The only way to deal with it is commensurate with the demand and the requirements. There is no use in saying we will make 15,000, 20,000 or 30,000 houses available if the need is for 150,000. We need to provide houses upfront in a serious hurry.

An opportunity comes up every so often to inflate house prices. Scarcity is one way to do that and that is the way things are now. A modest house in the Rathmines area went on the market in recent weeks for a modest asking price and eventually sold for €1.2 million or €1.3 million. This is utterly crazy stuff. It is all because people see an opportunity. It is people with money, not first-time buyers, who are doing that. People who bought houses four years ago, if they were able to get a loan to buy a house, can now sell those houses at a profit. That is a danger signal. It will displace first-time buyers who are now coming on the market. It is a crazy situation. It means the people who are waiting to get a house now for the first time, people with small kids and so on, may wait forever. Nothing will happen because they have been displaced. There is always a good reason such people cannot be accommodated now.

The Ceann Comhairle and I, from our experience, look at this kind of thing with a great deal of concern.

If we now want to find out how far and where we are going to go, let us evaluate the cost of building a house. In recent weeks, we noticed reports of increased building costs. Once we go beyond the building cost of a house, whatever it may be on the market, a person borrowing money for a house is in dangerous territory for the simple reason that he or she is now competing in a market. At that stage, all that person is doing is satisfying what needs to be satisfied when somebody else wants a house ahead of him or her and he or she is outbid.

The thing to remember is this. Incidentally, at the all-party special committee after the 2016 election, which we all attended, some of us put down a marker at the time to say we needed to build large numbers of affordable, good quality houses through the local authorities, which people could rent or buy as they wish. Do not forget that as soon as that happens, whether a person is renting or purchasing, whoever builds the houses for them, be it the State or the private sector, it means that an income is accruing there and then from the construction of those houses.

It is a very lucrative market for the rental sector. People say if it was not there, we would have a really serious problem and we would. If we did not have to rely on that, however, house prices would be much lower. I will digress for a minute. I thought this was the saddest story I came across in recent times. An immigrant returned home from abroad with a good job and profession. That person arrived here, took time to settle down and then decided to apply for a local authority loan. The person's income was within that scope but they were told they need six months' bank statements and income clarification because they had been out of work for the previous six months. I thought it was a crazy attitude. The person was in work before and was going to get a job. This person had to get a job because there was scarcity of labour in the area in which they majored. The result was that this person did not get a house, and still does not have a house, because the crisis raced ahead of them. The daftness of it all is when people in that kind of situation, who could easily be helped, are not being helped, encouraged or given hope. Hope is important to everybody, whatever their social status in life.

I had a discussion earlier with a lending institution that had designs on somebody's home. Hopefully, it will only be designs. I had to say this. The same despair applies to people at different income levels if they are not able to hold on to their homes. It does not matter what their income is. If they are going to lose it or if the loss is imminent, it affects them in the same way as a poorer person on a lesser income. Everybody is, therefore, entitled to hold on to their home and do the best they can to achieve that.

I hope we do not have many more of these debates. I know the Minister of State is genuine in his efforts to deal with the housing situation but I would warn that will take a much bigger effort than we have anticipated. My reason for so believing is that every so often, when it is about to become possible for many people throughout this country to realise a home of their own, something happens. The market takes off and it is outside their reach. Suddenly, they are competing with a market they cannot handle.

The Ceann Comhairle will recall that we had the shared ownership loan system, which was quite good and helpful to get people onto the housing market ladder. Some genius had a brainwave about the rental part of the equity, which was originally at a 4% interest charge or the equivalent of a local authority rent. Some genius decided he was going to increase the rental by 4% per annum, putting it right outside people's means and making it impossible. Entire reams of house loans went into arrears. It was not the loan part but the rental part of the equity that went into arrears because they were no longer able to handle it.

Can we please come to conclusion on it this time? Can we ensure that we build houses up front? The construction sector is well able to do this if we give it the authority, instruct it that the funding is available and ask it how many houses it can build, how quickly and for how much. It is not rocket science at all. It is quite simple. The Ceann Comhairle and I did it in our constituencies and proved that it could be done at a fraction of what the cost was otherwise in the marketplace.

I believe the Minister of State is genuine. I think he will do everything possible to achieve the result we want, which is to make a house available to everybody as quickly as possible, not in ten or 20 years’ time. When we tackle the housing situation for the 100,000 families on the housing list, we need to make serious inroads in the first year. If we have to do what was done in the past in this country and import the construction sector into the country to deal with the job, then that is what we must do. If we do not provide houses sooner rather than later, however, the tide is going to go out and it will be deemed to be a failure of the administration of the State, unfortunately, to provide for that cohort of people. It would be a sad thing to happen.

I appeal at this stage, therefore, to those who make the choices and decisions in certain high places - they are not the Ceann Comhairle and I - to make the decisions clearly in the knowledge that we do not have much time. At the very maximum, we have three years to solve and break the back of the problem we have nowadays. People start talking about how we can do it over ten years. Over ten years, we can do what we like. It makes no difference. If we do not deal with the problem up front, the children of today - the adults of tomorrow - will have gone past the stage where they are going to need a house at all.

It must be really awful for small kids to live on what is effectively a waiting list forever only to have no home of their own. Daddy and mammy are being asked on a daily basis when they are going to have a home, and the landlord or somebody else is pressing to tell that family they need the house to sell it to somebody else.

I will finish with this. I was asked by one of our councillors in the very recent past if I would visit a couple who were living in a caravan, which the Ceann Comhairle and I have often done. It was not to see for the first time what it was like but to simply see how they were coping in the circumstances. In the middle of winter, in freezing cold weather, two adults and a child were wearing summer clothes. All I can say is that if we do not respond to that kind of situation soon, we will rightly be blamed for failing in our duties.

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