Housing Policy

With all the talk about mortgage rules, it was left to Colm McCarthy in yesterday's Sunday Independent to make the most important point of all: the failure of our housing policy is not down to the Central Bank but to the Department of the Environment, the planning authorities and their political masters. Although the Central Bank deserves criticism for the runaway chaos of the 00s, the principal failure down through the decades has been by the political system. As McCarthy said, housing policy is the responsibility of the Government, not of the Central Bank, but because of our dysfunctional political system the Central Bank has been asked to do the heavy lifting. It can't.

When was the last time the Taoiseach, the Minister for Finance, the Minister for Housing or any Minister told the public that the price of houses should remain stable in real terms? When have Ministers spoken about the need for housing policy to be set in a wider context of economic and social development, including climate change? When have Ministers told the public that urban sprawl and the waste of good farm land has to be brought to an end and that people will have to live in cities (not commute every morning from ever expanding suburbs). The energy cost, the carbon footprint and the damage done to the fabric of cities (not to mention the quality of life of commuters) demands a major change of approach.

The Irish approach to housing is well captured by the ESB advertisement about the young man heading home for Christmas, bring greeted at the bus station by his father and being driven home to his house in the countryside to be greeted by his mother. It is an experience many people can relate to but it is a lifestyle that will have to change. The idea that work and home should be in different places (even if the advertisement is probably about a student) must be challenged. The majority of the population will have to adjust to living in urban areas within walking or cycling distance of their place of work, or, at worst, a short journey by public transport from within the town or city limits. Children should walk to school or at best go by school bus. Parents should be strongly discouraged or, if necessary, forbidden by law to bring children to school by car (especially by SUV!).

Planning permission should be closely linked to issues of density, public transport, schools and other factors. The question of price controls will have to be considered, if only to deal with the problems of development. Whereas in the past a "good" area of a town or city was home to a wide range of middle class professions and activities, nowadays, in effect, only doctors, lawyers, accountants and financial services personnel can afford to live in certain areas and send their children to the perceived top schools. This not only creates resentment among, say, senior public servants and teachers it also discourages people from choosing a career in the public service or teaching. That, in turn, impacts on economic and social development in two ways: we will have too many doctors, lawyers, etc. (not all of them suited to those professions) and not enough good public servants, teachers, etc.

House prices and the belief throughout Irish society that housing is the route to (unearned) wealth is a deeply ingrained cultural trait in what is a very greedy society and it will not be easy to change. Not surprisingly, public representatives are not prepared to address the greed factor but they will have to sooner or later. House prices have had a huge impact on other areas of public policy, including pay demands and the capacity of the State to provide much needed services. The high cost of living is a result of the greedy nature of Irish society, which won't be successfully tackled until we have a functioning housing policy. Changing cultural habits like greed are of course a lot more difficult to effect than changing mortgage rules but because we have 100 TDs too many the political class won't even try. The problems are mounting up, however, right across virtually every area of public policy and the common denominator - the dysfunctional political system, which needs massive pruning - will have to be addressed.