The Housing shortage saga - the root cause(s) ?

[Cold]

By the way, you do very much want to live in a place with a housing shortage. That means it’s appealing. It’s like the #1 metric.

Not that it’s unappealing per se but there is always Belfast if you want to live much cheaper. And drive whatever you want.

[fester]

Not that it’s unappealing per se but there is always Belfast if you want to live much cheaper. And drive whatever you want.

Ah things aren't that bad.

[SJ]

A high level of demand is nice but catastrophic shortages where families can neither own nor rent within a reasonable distance of work/school is not ok.

The state can either buy houses/developments from developers or can initiate construction projects (probably by tendering and getting those same developers to build them) so yes a slowdown does offer that kind of opportunity but I'm not seeing much evidence of a drop in construction project commencements as yet.
The State also has deficits in hospital and school construction so it's not like we can spend everything on houses either.

[-alan-]

A high level of demand is nice but catastrophic shortages where families can neither own nor rent within a reasonable distance of work/school is not ok.

The state can either buy houses/developments from developers or can initiate construction projects (probably by tendering and getting those same developers to build them) so yes a slowdown does offer that kind of opportunity but I'm not seeing much evidence of a drop in construction project commencements as yet.
The State also has deficits in hospital and school construction so it's not like we can spend everything on houses either.

That - plus and the deficit in housing - has to surely come down to a lack of effective planning going back 3-4 decades at this stage ?

One of the things that always struck me as odd for Ireland - which is basically a light-touch socialist state for want of a better description (imo) - is how/why the country never seemed to have the same type of social housing programme they do (or at least did) in places like the North and in the UK. There were 'Council' housing estates everywhere - respectable ones, which housed most working class folk in the towns and cities.

Up there (AIUI) , provision of social housing was a feature of every decent sized village and town throughout the place. As an aside - it wasn't issued to the unemployed / unemployable for free, but rented out at a reasonable rate, with the families being allowed to exercise a right to buy after something like 20-25 years. Fair exchange - after paying a fair rent for the places for a couple of decades, the residents were allowed to buy out the equity, which presumable went towards funding the building of replacement properties .

Was there ever such a housing programme here in the South, which ceased at some point - or is it something that just did not exist, with the supply and demand of houses being left to the vagaries of supply and demand and the prevailing economic market conditions ?

[SJ]

I don't have time to get into it, as usual, but Alan you may forget that Ireland was a poor country and literally couldn't afford expansive building.
We did a huge amount of social house construction from the 1930s to the 1950s, essentially self financing it through collection of rent, but as in other countries that model wasn't sustainable as costs increased and tenant incomes didn't, and we also wanted to sell the houses to tenants... but unlike other countries we didn't have the money to keep building.

When we got money in the mid 90s, as you know we were full on celtic tigers and nobody wanted council estates. Everyone could make a fortune building apartments and could buy them with no deposit so there was relatively little demand anyway.

Here's a paper on the golden age for Irish social housing. https://www.ucd.ie/geary/static/publ...rywp201901.pdf

[Flet]

-alan- I'm sure you don't need reminding but I thought much of the recent social housebuilding in NI came post-Direct Rule/Civil Rights protests as control over housing moved away from the councils into a central organisation. Housing had been tied to voting and deliberately rationed in some areas as a result, Derry in particular. Once this changed a lot of building happened in some areas, Derry obviously but also Ballymena and Antrim while the planned construction of Craigavon was scaled back.

[fez]

It’s no coincidence that council housing in the UK came about as part of the 1919 housing and town planning act, after WW1 they realised that these people were going to make up the majority of their army which explains why they were so fond of it.

[crank_case]

I costs increased and tenant incomes didn't

Now we're getting to heart of things aren't we?

Despite ever greater total wealth in the world than at any time in history, the average persons income has stagnated in the last 40 years or so in real terms. We probably don't notice it so much, because the entire country was broke, but it's more noticeable in countries that had it good for decades.

Your real buying power keeps going down while prices go up, there has never been a more asset-poor generation since WW2 while the super wealthy (the real super wealthy one percenters and perhaps even the one percent of one percenters, not the Sinn Fein definition of super wealthy meaning I have some nice things) have been able to leverage low interests rates and an ever increasing amount of financial vehicles and tools not available to regular people to buy up ever such as real estate, farmland, mining rights, water rights, public companies, sovreign debt, and of course cars and fine art - the fine art world essentially being a self sustaining machine to create money from nothing, then use that not to pay taxes, but that'd take too long to get into.

Meanwhile, the youth of the 90s were branded "Slackers" while today we have the utterly audacious brassneck PR spin of stories about Gen Zs "quiet quitting" appearing all over the media for some reason. 1984 doublespeak at its finest. As if people simply doing the job they were hired to do exactly rather than doing lots of free overtime was "quitting". People aren't so much getting lazier as realizing their hard work does not pay, it is not rewarded with substantial increases in income in real terms. I do think people should work if they can and not drop out and sponge off the system, but really, is it any wonder people who don't have great prospects anyway just say "well screw this?"

The whole idea of there being a "middle class" at all is pretty much spin, yet more divide and conquer. It's meant to make you fearful that the lower class is going to steal your cake when you're not looking, so that people support things outside their own interests. What's hilarious is such a wide spectrum of people identify as "middle class" from barely above minimum wage to actual millionaires who don't see themselves as wealthy that the idea that it's a real classs of people is nonsense. There is only really the people who earn their money from their own labour (including the small business owners and even medium employers) and the folks that make their money primarily from the labour of others - A rentier capitalist class.

Being a member of this rentier capitalis class doesn't necessarily mean you're an employer either. If you're making your money from having a monopoly on things in short supply like housing, or primarily from things like shares and bonds, then you'd fit into this class.

The funny thing is "Rentier" is generally seen as a bad thing by both classic Marxists and classic capitalists. You're extracting wealth from the overall economic system but without creating actual economic activity / production yourself. Yet, because these folks who don't really actually do anything useful have been able to accumlualate so much wealth, more than many sovreign nations, they've been able to influence policy to their will and hoodwink the public into being their cheerleaders by holding out the bauble that they too could "make it" if they work hard... which clearly has not been the case in 3 generations now.

That is a big part of your big picture global root cause, there are other local aggravations to the problem but that's my take on how we got here.

[Cold]

So seeing as we don’t notice it, can we ignore the rest of your post and get on with not noticing it?

I think you completely missed the gist of SJ’s post, by the way.

[crank_case]

..on a more local note though, something I'd classify as a strong aggravating factor here is Capital Gains Tax at 33% and payable on even making modest gains.

There's an idea that Irish people are obsessed with investing in property, but it's only partly true I reckon. It's just that it's one of the few relatively tax efficient ways of having an investment for retirement outside your pension. I don't invest in the stock market or anything, but when I used to get company RSU shares in my last job, it didn't really make sense to do anything other than sell them straight away unless you reckoned you'd see a fair old jump. If you hung on to them, you'd end up paying CGT on the value increase, so you've the hassle of squaring that with the tax man and by the time you've dealt with other fees, it's barely worth it so it was just as well to cash in straight away. Same company pretty ended up switching to giving people cash bonuses instead of further RSUs as it was so tax inefficient.

[crank_case]

So seeing as we don’t notice it, can we ignore the rest of your post and get on with not noticing it?

I think you completely missed the gist of SJ’s post, by the way.

Do what you like man..

Not ruling out missing the point of SJs post, but he's a big lad, he can let me know.

[mikerd4]

I don't know what your ex company was at crank but shares up to 12700 can be given tax free (held for 3 years) and then you can make 1270 on top when selling them. Giving cash is seriously tax inefficient. But back onto housing....

[crank_case]

I don't know what your ex company was at crank but shares up to 12700 can be given tax free (held for 3 years) and then you can make 1270 on top when selling them. Giving cash is seriously tax inefficient. But back onto housing....

We did have a truly awful and incompetent HR Dept, so I doubt they explained how to use our benefits too well. Their reasoning for not given RSUs any more was given as tax inefficiency alright, but who knows.

Good to know this, thanks.

[mikerd4]

If you want to be extra tax efficient what money you have after 3 years you can then make as a one off avc to your pension and you will get the tax back from the government.
I'm sure there are other tax efficient schemes aswell, I'm no expert on the matter

[Flet]

Significant pension contributions are the only real (legal) tax avoidance scheme available to the working (wo)man.