Green Party Housing & Homelessness Policy - December 2015
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Green Party Housing & Homelessness Policy December 2015
Housing & Homelessness Policy November, 2015
Table of Contents
SUMMARY & KEY POINTS ..................................................................................................... 1
INTRODUCTION..................................................................................................................... 3
PRINCIPLES ...................................................................................................................... 3
BACKGROUND .................................................................................................................. 5
THE CURRENT CRISIS .......................................................................................................... 6
RENT SUPPLEMENTS ........................................................................................................ 6
The Calculation of Rent Supplement ......................................................................... 6
Flexibility of Rent Supplements.................................................................................. 7
Deposits & Rent-in-Advance ...................................................................................... 8
The Social Stigma of Rent Supplement Tenants ....................................................... 8
REDUCING THE HOUSING LIST ........................................................................................... 8
MORTGAGES IN ARREARS ................................................................................................. 9
ACCIDENTAL LANDLORDS .................................................................................................. 9
Buy to Let Investors ................................................................................................. 10
TOWARDS A SUSTAINABLE HOUSING SECTOR...................................................................... 11
HOUSING AFFORDABILITY ................................................................................................ 11
Access to Credit ....................................................................................................... 12
INCREASING HOUSING SUPPLY ........................................................................................ 12
Increasing Investment .............................................................................................. 12
Increasing the Supply of Social Housing ................................................................. 13
ACTIVE LAND MANAGEMENT ............................................................................................ 17
SUSTAINABLE PLANNING ................................................................................................. 18
SUSTAINABLE HOMEOWNERSHIP ..................................................................................... 20
SUSTAINABLE PRIVATE RENTAL ....................................................................................... 21
SUSTAINABLE CONSTRUCTION ......................................................................................... 25
ENSURE COMMUNITY PARTICIPATION IN HOUSING DECISIONS ............................................ 26Housing & Homelessness Policy November, 2015 HOUSING RIGHTS ........................................................................................................... 26 CREATING EMPLOYMENT AS PART OF INCENTIVISING SUPPLY............................................. 26 CHRONIC HOMELESSNESS .............................................................................................. 28 Prevention ................................................................................................................ 28 Children & Young People......................................................................................... 28 The Travelling Community ....................................................................................... 29 The Migrant Community ........................................................................................... 29 Health....................................................................................................................... 29 Substance Addiction ................................................................................................ 30 Prison ....................................................................................................................... 30 Families.................................................................................................................... 32 Employment ............................................................................................................. 32 Government Agencies.............................................................................................. 32 Current Social Housing Tenants .............................................................................. 33
Summary & Key Points
Ireland’s housing landscape has changed considerably over the last number of years. In order to
avoid the boom and bust mistakes of the past and capitalise on existing State resources, the Green
Party believes in a fundamental rethinking of housing provision in Ireland; one that focuses on giving
everyone the opportunity of living in a good home at a reasonable cost, in a stimulating, secure and
sustainable environment.
We see housing as a social right, interdependent with good planning, transport, infrastructural
development and land management. In particular, we believe housing policy should promote good
outcomes for children, young people and those most vulnerable in society. Given Ireland’s recent
experience of fluctuating property prices and availability, we believe it is important that Ireland
adopts short-term, medium-term and long-term measures that address our immediate needs and
ultimately move our housing system towards a more sustainable model.
The Green Party supports a housing sector that provides affordable housing for all. We see this as
being a combination of private rental with security of tenure, social housing founded on a cost-rental
model and homeownership at a cost equal to no more than 30% of their net income unless they
freely choose otherwise. We also believe that a mortgage should be affordable and it should not be
for longer than 25 years.
Given the current crisis in housing, the Green Party is in favour of the following interim measures to
help stabilise the sector in the short-term.
The removal of sale as a reason for ending a lease.
Better resourcing of the PTRB is required to allow for swift resolution of disputes between
landlords and tenants.
Rent Supplement should be paid in advance and deposits and rent-in-advance should be
available to all rent supplement tenants.
A housing trust scheme to acquire encumbered buy-to-let properties for social housing,
through purchase or lease.
In addition to the crisis management actions listed above, the Green Party believes that the state
must revert to playing a more active role in the housing sector in Ireland. Only by exerting its
influence through the provision of social housing and land management can it hope to keep the
housing sector stable in the long term. The Green Party also believes that public policy should focus
on housing for occupation, limiting the ability to use housing as a speculative asset. Therefore, the
Green Party advocates that
The state needs to take a more active role in the delivery of housing and for that reason
never dispose of public land zoned for housing, unless doing so allows it to buy more
appropriate land.
Replace the unfair Local Property Tax with a site value tax charged on the value of all non-
agricultural land. This tax is charged on the site, rather than any improvements on it, and
encourages the efficient use of land and redevelopment of brown field sites.
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |1A levy is applied to all vacant properties that could be utilised as housing.
A referendum on housing and property rights should be held
A stable, affordable private rental sector is key to removing the volatility from house prices
and that this is predicated, in part, on rent certainty and indefinite leases.
We believe that a stable private rental sector requires a strengthening of the PRTB dispute
resolution section in addressing issues concerning both tenants and landlords.
We also believe that a stable private rental sector requires fair treatment under the tax
system for landlords to make lettings viable and for tenants to make rents affordable.
The state should implement a cost-rental model on all social housing, which would be
delivered by a newly formed National Housing Trust – linked to local authorities – that
would be outside the general government sector and provide a combination of affordable
and social housing, either directly or via community land trusts or housing associations. The
institution should ideally incorporate the capabilities developed in the Housing Agency and
NAMA and could be an amalgam of the two. It would also incorporate existing expertise in
the Department of Environment, Heritage and Local Government, the Local Authorities
and in the Housing Associations and Co-operatives.
The Green Party recognises the success of the Housing First strategy in other jurisdictions and sees it
as fundamental to eradication of homelessness in Ireland. There is a clear message from the pathways
biographies that there needs to be more early intervention and attention to the structural causes and
individual risk factors that lead to homelessness. We need to better resource flexible preventative
services in our communities and safe shelters to help families move towards stability. We also support
the following:
The Aftercare Bill, which guarantees a right to an aftercare assessment on turning 18 and
leaving care, should be fully implemented and the resulting services fully resourced.
Habital Residence Condition (HRC decisions) should be published and where an appeal for
residency status is pending, homeless migrants should, at a minimum, continue to have
access to temporary emergency accommodation.
Medical cards should be issued based on an individual’s PPS number and not on the basis of
a permanent residential address.
Should a household have to reapply for rent supplement within a given period, they should
not have to go through the full approval process again and those identified as having a
housing need by a local authority should be pre-approved for rent supplement. Similarly, all
housing support payments should be tapered off as income levels increase and not operate
on a cut-off basis.
Local Authorities should be obliged to offer tenancy sustainment supports to tenants who
had received a warning before resorting to legal action.
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |2Introduction
Housing policy and development for housing is about much more than investment and a return on
investment, property deals and speculation. The Green Party believes that housing policy should
make the link between the built environment and people’s well-being. We want to build
neighbourhoods that are people-centred and that include easy access to green spaces and community
facilities. We want to sustain a cultural life as well as a business environment. We want people to feel
they belong; that they have a sense of ownership and a stake in their communities. We want high-
quality landscape design and shared spaces. We value aesthetics and we want to bring benefit to our
communities by integrating positive plant and animal wildlife, building places for them as fellow
inhabitants of our neighbourhoods. The Green Party is also committed to the achievement of zero
carbon buildings and using smart technology and materials in the building industry to drive
sustainability in construction.
The issues of housing and homelessness are in inextricably linked. Traditionally homelessness in
Ireland was a symptom of a disordered society and those experiencing it were most likely to have
experienced physical or sexual abuse in the home, drug or alcohol addiction and mental health issues.
Individuals finding themselves homeless for these reasons may experience homelessness for a short
period of time while others may remain homeless for decades. They may also be hidden, with people
living short to medium-term on the couches or in the spare room of friends and family, while some
are very public as with ‘sleeping rough’. This profile of homelessness is complex and takes time and
commitment to unravel as ‘most theoretical and practice viewpoints agree that the causation of
homelessness is complex, with no single ‘trigger’ being either ‘necessary’ or ‘sufficient’ for it to
occur’1.
In recent times we’ve started to experience a new form of homelessness, one that is wholly and
exclusively down to economic circumstances. The Green Party believes that we need to develop
strategies and policies that deal with both forms of homelessness concurrently, recognizing that the
causes and therefore needs of each group may be very distinct. That said, we believe that all
government policies needs to address homelessness on multiple fronts by
Preventing homelessness
Provide rapid response for those that are out of home
Help those at risk of homelessness move towards stable housing for the long-term
Principles
Affordable: Everyone has the right to a secure and affordable home.
Access to resources: Homes should be in locations that facilitate relatively easy access to
employment, health-care services, schools, child-care centers and other social facilities.
1
https://www.focusireland.ie/about-homelessness/understanding-homelessness/causes (accessed 20th Sept 2015)
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |3Inclusive: Communities should reflect social demographic of society. Individual should be
able to move to more appropriate housing, within their locality, as their needs change. This
requires a diverse range of housing types within a community.
Accessible: Homes should be accessible to those entitled to it. Priority should be given to
disadvantaged groups such as the elderly, children, the physically disabled, the terminally ill,
persons with persistent medical problems and victims of natural disasters.
Affordable services: Homes should have affordable, sustainable access to natural and
common resources including safe drinking water, energy, broadband, sanitation, refuse
disposal, site drainage and emergency services.
Habitable: Homes should be habitable and environmentally sustainable in terms of providing
people with adequate space, independence and protection from the elements.
Sustainable Planning: Planning should be done in a sustainable way with priority given to
proper community services and infrastructure in a way that allows people access their right
to community participation.
Community participation: Everyone has the right to participate in housing-related decision-
making at national and community levels.
Diversity: Planning and construction should facilitate the expression of cultural identity and
diversity of housing.
Security: The provision of good quality temporary, transitional and permanent
accommodation for all those not in a position to provide their own.
Caring Services: We believe that the state needs to provide services that:
- are people-centered
- treat individuals with respect and dignity
- are transparent and subject to review and appeal
- are efficient and effective
- are flexible and tailored to the individual wherever possible
Independence: The Green Party believes in services that help individuals at risk of on-going
homelessness need to focus on building the skills required to be independent and
autonomous by:
- supporting independent living
- educating them of their rights
- providing peer support and mentoring
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |4Background
In Ireland, over one million households own their own homes, slightly more than half of whom still
have a mortgage. The remainder - just under half a million households - live in some form of rented
accommodation. The state provides direct housing support for approximately 130,000 people
through local authorities, some of which is leased from the private sector. The state also provides
rent supplement for approximately 80,000 people who are renting directly from the private sector 2.
In 2013, 74,000 persons on Rent Supplement cost the State €344m 3.
According to the CSO, the number of households grew by 13% between 2006 and 2011, and it has
been projected that it will increase by 5% between 2011 and 2016, resulting in some 85,000 additional
households in a mid scenario. Recent analysis by the ESRI has estimated that, in coming years,
increases in population will result in the formation of at least 20,000 new households each year, each
requiring a separate dwelling4. In addition, a number of existing dwellings will disappear through
redevelopment or dilapidation. The results suggest an ongoing need for at least 25,000 new dwellings
a year over the coming fifteen years5.
2
NESC: Social Housing at the Crossroads, June 2014, pg 2
3
PTRB: Rent Stability in the Private Rented Sector, Sept 2014, pg iv
4
Housing Agency: National Statement of Housing Supply and Demand, July 2015, pg 27
5
Construction 2020, May 2014, pg 10
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |5The Current Crisis
The State’s exposure to this housing crisis is now evident in several ways: the number of mortgages
in distress, long waiting lists for housing, rising homelessness, and rapidly rising rents, particularly in
Dublin. The Green Party believes that we need to solve this crisis in a sustainable manner that will
end the cyclical boom-bust dynamic that unfortunately seems to be integral to housing in Ireland.
Well before the crisis and current logjam, Ireland’s system of land allocation and housing supply was
dysfunctional. Casey argued that, despite an apparently adequate supply, the market for building-land
worked poorly in Dublin. He suggests three reasons for this. Firstly, local authorities withdrew from
intervention in the land market. In the 1970s, they owned around 30 per cent of zoned building land
and sold land during upturns and bought it during downturns. But in June 2006, only 9 per cent of
zoned residential land was owned by local authorities. Secondly, land developers filled the gap left by
local authorities, and this shifted market power from builders to developers. Thirdly, ownership of
large amounts of building land in some areas was very concentrated, and these landowners
cooperated rather than competed, contributing to poor land market performance 6.
Households in the private rental sector have fared particularly badly over recent years. The long-run
nominal annual growth in rents of 5 per cent may seem high, but is considerably lower than the rate
of inflation over this period: from 1947 to 2013, rents fell by around 40 per cent in real terms 7.
However, in the three years since the end of 2011 we have seen a very sharp increase, with rents in
Dublin up by 21 per cent, and by 8 percent nationally (PRTB, 2014 cited in NESC: Pathways to
Secure Occupancy and Affordable Supply, 2014).
We believe that resolving the current housing crisis is primarily about increasing supply of the right
type of accommodation at the right price in the right areas. We believe that a key component of this
supply must be a sustainable model for social housing, otherwise we will be sowing the seeds for
future social inequality and boom-bust cycles as happened after the 1980s8. We also believe that we
need a twin-track approach to resolving the problem of homelessness; firstly we need to take
immediate steps to make the existing system fairer, more efficient and more responsive, and secondly
we need to work towards replacing the current system with a housing system that is accessible,
affordable and sustainable.
Rent Supplements
The Calculation of Rent Supplement
In 2011, the Department decided that households on Rent Supplement (RS) should be confined to
cheapest 40% of all rented accommodation because households on RS accounted for 40% of all
rented properties. In the 2013 review, the Department has narrowed this further so that RS
households should only be able to rent the cheapest 35% of available properties, on the basis that RS
now accounted for 30% of properties. For this policy to work effectively RS households would have
to account for the overwhelming number of the households in these cheaper units (85%). The reality
is that families on RS are competing for these cheaper homes with low-income working households
and with students who also want inexpensive accommodation.
6
Casey, J. (2007), 'Second Vote of Thanks', Journal of the Statistical and Social Inquiry Society of Ireland, XXXVI: 121–125.
7
NESC: Ireland’s Rental Sector, May 2015, pg 22
8
NESC: Housing Supply & Land, July 2015, pg 14
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |6The Green Party recognises the success of the Tenancy Protection Service (TPS), operated by
Threshold, which affords an increased payment of rent supplement above the relevant maximum
rental limit to individuals at risk of becoming homeless. This service, which only currently operates in
Dublin and Cork, has succeeded in helping 2,808 people (including 1,625 children) in its first year at a
fraction of the cost of emergency accommodation 9. We think it’s unfortunate that those of risk of
homelessness require the services of an intermediate in order to gain an increase in rent allowance
from the Department of Social Protection. We advise a review of the internal rent supplement review
process within the DSP to determine why an intermediary is required. In the interim we advocate
that this service is rolled out on a nationwide basis and that it is extended to include households who
are not private renters, but are at risk of homelessness due to house repossessions. We would also
allow tenants to make applications in advance of rent increases and not force them to wait until the
month the rent increase is taking place.
Flexibility of Rent Supplements
The Department’s 2015 report reviewing rent supplement limits suggests that increasing limits would
have a number of negative potential impacts. Among these is the suggestion that an increase in rent
supplement limits would give an impetus to landlords to renegotiate rents upwards. It also argues that
it might drive rent price inflation in the wider market, particularly for low-income households that are
competing for similar properties. It argues that the impact on new supply may be marginal at best,
given the acute shortage of all rental accommodation. While this may be true to some extent, we
believe that greater flexibility over rent supplements is necessary in the current crisis, until our
proposals in the section 'Towards a Sustainable Housing Sector' for increasing supply and making
private renting more sustainable can be achieved.
The Green Party is not of the view that we should be heavily dependent on the private rental sector
when it comes to housing those not in a position to afford to pay for their own accommodation
costs. We believe that the state should take a much more proactive role in providing housing for such
households. Should rent supplements to the private sector exist in the future, then we support Focus
Ireland’s view that the maximum rental limit should be set at the modal average of rents in any
particular area, and it should be reviewed every 6 months. Also, the rent supplement rates for single
people in urban areas should be increased to marginally below the rate for couples to reflect the fact
that, with the removal of bed-sit accommodation from the market, singles and couples both require 1
bed accommodation. We also believe that rent limits should be set in a more transparent manner,
through an independent process, and should better reflect both actual market rents and urban and
rural variations. In areas where there are significant fluctuations, this could result in savings to the
State. We also propose a restructuring of the Rent Supplement scheme to bring it in line with the
Residential Tenancies Act 2004, which currently fails to measure up to10. As recommended in
Thresholds Report on the TPS advocate
For the payment of rent supplement in advance and not in arrears
The introduction of a pre-approval mechanism for RS claimants who have been assessed by
the relevant local authority as having a housing need;
9
Threshold, Dublin Tenancy Protection Service: One Year Preventing Homelessness, Sept 2015, pg 2
10
Threshold, Dublin Tenancy Protection Service: One Year Preventing Homelessness, Sept 2015, pg 22
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |7The removal of the requirement that a claimant furnish a tenancy/lease agreement as part of
the applications process;
To ensure that RS continues to be paid while an appeal is pending
A review of the documentation requirements for RS and provide for direct submission of
confidential documents by landlords to the Department of Social Protection representatives
That RS claimants are given at least 28 days’ notice of the suspension or termination of RS
payments
Deposits & Rent-in-Advance
It is frequently the case that relatively small amounts of financial assistance can allow a person in
Emergency Homeless Accommodation to secure sustainable private rented accommodation. The
assistance may be access to a deposit, rent in advance or a slightly higher rent level required to access
accommodation near to social connections and supports. Such small payments can result in
substantial savings in expensive Emergency Accommodation. But since the costs accrue to the
Department of Social Protection and the savings accrue to the Local Authority, it can be difficult for
public servants to justify such discretionary payments. By moving the discretion on these issues to
within the Local Authority, flexibility to make informed decisions that are in the interest of the
person who is homeless and of the taxpayer should be facilitated.
Similarly, access to a deposit is often a problem for people in receipt of rent supplement. The issue
of advancing a month’s rent needs to be formalised rather than leaving it in its current discretionary
form. Few landlords will accept a tenant without some form of rent in advance being paid, so doing
this would give those in receipt of Rent Supplement greater surety in negotiations with landlords and
is more likely to result in them being homed successfully11. Also, if a renter loses their deposit or
part-of, regardless of the reason, it is not replaced or topped-up, which can leave them in a desperate
situation. We advocate that the replacement or topping up of deposits should be allowed if it is
believed that it will help prevent an individual from becoming homeless.
The Social Stigma of Rent Supplement Tenants
A recent PTRB survey report cited some landlords will not rent to social housing tenants or
individuals in receipt of rent supplement recipients12. Rent supplement is an important element of the
state’s support to those unable to fully meet their housing needs. Allowing landlords to refuse rent
supplement without any other basis for refusal of a tenancy completely undermines this state
support. As such, amendments should be made to equality legislation to prevent the practice of
tenants being rejected solely on the basis of receiving rent supplement.
Reducing the Housing List
Increasing the supply of appropriate housing is key to reducing the housing list but often people are
listed on the housing list, not because they are homeless but, because they are in accommodation that
is unsuitable for their needs. We propose to create a website that would facilitate the transfer of
social housing between tenants. The transfer will be ultimately handled by the local housing
11
FT Houghton and C Hickey, ‘Caught in a Trap’, Focus Ireland, 2001, pg 37
12
Private Rented Sector Survey Findings: Tenants, Landlords & Estate Agents for the PTRB, Oct 2015, pg 47
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |8department, but such a move will help empower social housing tenants in solving their own housing
needs.
Mortgages in Arrears
It is important that sustainable long-term solutions are developed for those who bought homes to
live in during the boom and due to circumstances beyond their control are unable to make their
monthly mortgage payments.
Under the national mortgage-to-rent scheme, people who are having trouble paying their mortgage
to a private lender can switch from owning their home to renting their home as social tenants of a
housing association, which buys the home from the lender. The proceeds from the sale of the home
to the housing association go towards the mortgage debt and the homeowner must come to an
arrangement with their lender for the remaining balance that is owed, if any. If the homeowner’s
financial situation improves, they will have an option to buy your home back from the housing
association after 5 years. Unfortunately, the number of homeowners who successfully availed of this
scheme is very small and anecdotal evidence suggests that banks are not engaging with the scheme
because they feel it is too cumbersome and there had been difficulty agreeing on a value for homes 13.
The Green Party supports
a swift review of the initiative and implementation of any recommendations on how to
improve its effectiveness.
the transferring of any residual debt owed on family homes by households qualifying for
this scheme to the state. This debt would then be subject to a low interest rate.
the extension of this scheme to Community Land Trusts
Accidental Landlords
It is an unavoidable truth that approximately 36% of landlords in Ireland today are ‘accidental’
landlords14, of which a sizeable portion - approximately 31.3 per cent- wish to cease as a landlord as
soon as possible15. Of the 70% of landlords – accidental or otherwise – 71% report that the rent paid
to them doesn’t cover the cost of the debt on the property 16. Sixty six per cent of estate agents
believed that landlords will be looking to sell their rental properties when prices rise 17. We need to
manage the exodus of these ‘accidental’ landlords from the private rental market, either by providing
alternative social housing or encourage these landlords to sell their properties to the state. Doing this
will give the state access to more housing that it can rent out at affordable levels and reduce its
exposure to market rent increases.
13
http://www.independent.ie/business/personal-finance/property-mortgages/coalitions-mortgagetorent-scheme-a-miserable-failure-
30216927.html (accessed 20 Sept 2015)
14
Private Rented Sector Survey Findings: Tenants, Landlords & Estate Agents for the PTRB, 2015, pg 42
15
Private Rented Sector Survey Findings: Tenants, Landlords & Estate Agents for the PTRB, 2015, pg 47
16
Private Rented Sector Survey Findings: Tenants, Landlords & Estate Agents for the PTRB, Oct 2015, pg 44
17
Private Rented Sector Survey Findings: Tenants, Landlords & Estate Agents for the PTRB, Oct 2015, pg 60
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e |9Buy to Let Investors
The number of buy to let mortgages increased from 17 per cent in 2003 to 26 per cent in 200618. At
the end of December 2013, there were over 144,000 buy-to-let mortgages, which represent 45 per
cent of all privately rented properties recorded in Census 201119. Out of a total of around 144,000
BTL mortgage accounts, 39,669 were in arrears at the end of June 2014. This figure represents 27.5
per cent of the total BTL mortgage loan accounts or 13 per cent of the total estimated stock of
305,377 units rented from private landlords20. Research shows that 70 per cent of the landlords have
an outstanding debt on their property, and for 71 per cent of these, the rent did not cover their debt
repayments21. It is undoubtedly the case that most of these are BTL properties bought at the height
of the house-price bubble. It has been reported by Sherry Fitzgerald22 that there were more sales
than purchases of buy-to-let properties by investors in 2014, indicating a decline in the stock of buy-
to-let rental properties.
The Green Party acknowledge that while this is firstly a banking and finance issue, the way in which
encumbered buy-to-let mortgages are handled can potentially have an important role in reducing the
upward pressure on rents and eviction of low-income or rent supplement tenants. An effective
strategy in this regard could result in a saving to the state vis-á-vis the cost of building new social
housing23. Currently there are no resolution strategies in place for buy to let (BTL) mortgages, which
in many cases is negatively impacting on tenants where properties are in receivership.24 There would
seem to be scope for a larger share of encumbered buy-to-let properties to be acquired for social
housing, through purchase or lease. In devising a programme to manage the transition of
encumbered buy-to-let properties, a relevant factor would be the low cost of long-term government
debt25. We also propose the state provides clear guidance for Department of Social Protection
representatives to deal with circumstances where receivers are appointed to properties with RS
tenants as recommended in Threshold’s report on Tenancy Protection Service (2015, pg 22).
18
Norris, M. & Coates, D. How Housing Killed the Celtic Tiger: Anatomy, Consequences and Lessons of Ireland’s Housing Boom and
Bust, 2000–2009 pg 9.
19
NESC: Homeownership and Rental: What Road is Ireland On, Dec 2014, pg 22
20
PTRB: Rent Stability in the Private Rented Sector, Sept 2014, pg v
21
DKM Economic Consultants (2014), Future of the Private Rented Sector: Final Report, pg 21
22
Sherry FitzGerald (2015), Irish Residential Property Market
23
NESC: Ireland’s Rental Sector Report, May 2015, pg 11
24
PTRB: Rent Stability in the Private Rented Sector, Sept 2014, pg v
25
NESC: Ireland’s Rental Sector Report, May 2015, pg xiii
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 10Towards a Sustainable Housing Sector
We concur with the view that housing is not simply a commodity that can be left to be traded
unfettered on the open market26, and that policy should focus on housing for occupation, limiting
the ability to use housing as a speculative asset. 27 We also believe that the provision of affordable
housing is not a dualist battle between investment and profit on one hand and security of tenure and
affordability on the other. It is a balance of the two and it is apparent that those jurisdictions that
have strong rent regulations and a strong private rented sector also have an equitable taxation system
in place and in some cases generous depreciation allowances, fiscal benefits and subsidies to promote
investment28. We do not want to risk a repeat of the late 90s when tax relief for investors was
abolished in an effort to slow the rise in house prices. This caused a decrease in supply, rents shot up
and the measure was reversed29. That said we do need a clear, simple system with conditional
incentives that are tailored to specific situations, not broad-stroked inducements which just stimulate
building but not necessarily the right building type in the right areas.
We also believe that private rental sector issues (such as rent certainty and security of tenure) cannot
be resolved without also addressing the supply challenge. We also believe the supply challenge cannot
be addressed without more direct state influence on housing supply and more active land
management30 and will discuss this later on in the policy.
Housing Affordability
Affordability covers a wide variety of issues including housing prices, incomes, creditworthiness,
housing quality, housing policies, supply, and individuals’ decisions regarding how much expenditure
they wish to devote to housing (Norris, 2014 cited in NESC’s Homeownership & Rental: What Road
is Ireland on, 2014). In many countries, affordability is defined as housing costs that consume no
more than 30 to 40 per cent of household income31. In Ireland, the Planning and Development Act
2000 defines affordable housing as housing or building land provided for those who need
accommodation and who otherwise would have to pay over 35 per cent of their net annual income
on mortgage payments for the purchase of a suitable dwelling.
The EBS/DKM data shows that in February 2014, a single first-time buyer on average earnings
would pay 38 per cent of their net income on mortgage repayments, at the limit of what is
considered to be a cost burden in the international literature (30 per cent of gross income)32. The
Green Party believes that all people should be able to live in appropriate and sustainable housing for
a cost of no more than 30% of their net income unless they freely choose otherwise. We also believe
that a mortgage should be affordable and it should not be for longer than 25 years. For a significant
proportion of the population this is becoming very difficult, if not impossible.
26
McKinsey Global Institute: A blueprint for addressing the global affordable housing challenge, Oct 2014, pg 108
27
NESC: Social Housing at the crossroads, June 2014, pg 3
28
PTRB: Rent Stability in the Private Rented Sector, Sept 2014, pg iii
29
http://www.independent.ie/business/commercial-property/the-right-moves-would-rent-controls-work-30964912.html (accessed 20 Sept
2015)
30
NESC: Ireland’s Rental Sector Report, May 2015, pg 42
31
McKinsey Global Institute: A blueprint for addressing the global affordable housing challenge, Oct 2014, pg 1
32
EBS DKM Irish Housing Affordability Index, May 2015, pg 8
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 11Access to Credit
The Green Party supports the recently introduced restrictions on mortgages but would also welcome
the introduction of a Central Credit Register to assist lenders in ascertaining total borrower
indebtedness. We also believe that if a potential borrower can demonstrate a track record of ability to
pay rent over a sustained period that this should be taken into account when assessing affordability.
Increasing Housing Supply
Increasing Investment
We believed that investment in housing is required in both the public and private sector to provide a
stable rental market. Irish pension funds benefit from generous tax breaks and we would encourage
or require them to invest a proportion of their funds for new housing development.
Where it is identified that interest in developing particular sections of land is not forthcoming, we
advocate for the parcelling of separate land banks into one contract and inviting tenders on that
basis, as this would likely make the contract more attractive to a wider pool of construction
companies both at home and abroad33. This has been a distinctive feature of the land market in
Germany for several decades. This instrument was initially used for rural land adjustment but was
extended in 1940 to built-up land. This can be done on a voluntary basis but there is provision for
the use of compulsory measures if voluntary agreement cannot be reached. 34
Making Construction More Efficient
McKinsey Global Institute highlights the scope to reduce construction costs for affordable housing
by improving capital productivity via lean production, adopting value engineering approaches,
improving procurement practices and learning from industrial construction techniques. The same
report also indicates that improving energy efficiency and reducing the costs of repairing and
maintaining buildings can serve to reduce operating expenses and sustain asset values, thus increasing
the economic attractiveness of investing in affordable housing provision.
Research by the Housing Supply Task Force has indicated that developers see the planning process
as burdensome35. We do not advocate a lessening of the regulatory nature of our planning
departments. Instead we would support planners providing more clear direction to developers on
how best to bring developments in line with planning regulations.
We support the recent move by Enterprise Ireland to start a Business Information Modelling (BIM)
programme and recognise the great efficiencies that BIM has provided on projects in England.’ BIM
has been identified as a significant contributor to the saving of £804m in construction costs in
2013/14 recently announced by the Cabinet Office.36
Increasing Investment in Private Rental
We believed that investment in housing is required in both the public and private sector to provide a
stable rental market. Irish pension funds benefit from generous tax breaks and we would encourage
33
NESC: Housing Supply & Land, July 2015, pg 17
34
NESC: Housing Supply & Land, July 2015, Appendix 1, pg 39
35
NESC: Housing Supply & Land, July 2015, pg 28
36
NESC: Housing Supply & Land, July 2015,, pg 31 (Digital Built Britain, 2015)
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 12or require them to invest a proportion of their funds in rental housing as part of their low risk
investment class and corporate social responsibility.
We recognise that Ireland does not have a tradition of developing new housing designed for
institutional rental supply and there is a need to devote attention to the specific requirements of this
type of new supply if we are to consider it as a channel for affordable private rental.37
We are in favour of the imposition of a new tax levied annually at a progressive rate on the site value
of lands suitable for building which currently lie undeveloped.
We believe that a proportion of the uplift in land value created due to the provision of infrastructure
in the area by the state should be paid by the land owner to the state on the sale of the land. We also
believe that a percentage of the up-lift in land value created through the planning process should be
paid to the state on the sale of the land.
Increasing Investment in Student Accommodation
The Society of Chartered Surveyors expressed concern about the impact of higher rents on students,
which may be adversely affecting the ability of some third-level institutions to attract students38. If 3rd
level institutions built residences on their land it would safeguard the attendance of students and
would be attractive to students and free up residences in the private rental market for other
individuals.
Increasing the Supply of Social Housing
It has been observed over the past century in modern liberal democracies, including Ireland, that the
market for owner-occupied and rental accommodation is unlikely, on its own, to meet the housing
needs of those on low incomes or with special housing needs. In a period of unprecedented
economic growth, prosperity, employment creation and unemployment reduction from 1994 to
2004, those on low incomes and with special needs faced increased, rather than decreased, difficulty
in the markets for home ownership and rental accommodation 39.
‘Inevitably, when prices are high those at the bottom end of the market will be priced out. When
prices are low, supplying those at the bottom end of the market will not be profitable’40.
Even just on a practical level, a recent PTRB survey report cited some landlords will not rent to
members of the travelling community, social housing tenants or individuals in receipt of rent
supplement41. Also, trends in Ireland’s tenure mix, affordability, demography and economy suggest
that one-quarter to one-third of the population will find it increasingly difficult to achieve
homeownership and that, in the absence of an effective new social housing strategy; there will be
increased polarisation in housing options and conditions42. Additionally, using the private rental
sector to meet social housing need exposes the Exchequer to rising market rents.
In 2011 there were approximately 1.7m permanent households in Ireland. Approximately 450,000 of
these did not own their own homes. Of these 275,000, or 55 per cent, were in receipt of some form
37
NESC: Ireland’s Rental Sector Report, May 2015, pg 74
38
Society of Chartered Surveyors of Ireland (2015), Annual Residential Property Review & Outlook:The 2015 Report, pg 12
39
NESC: Social housing at the Crossroads, June 2014, pg 23
40
Dunne, T, High Developments Land Prices and the Realities of Urban Property Markets, pg 77
41
Private Rented Sector Survey Findings: Tenants, Landlords & Estate Agents for the PTRB, Oct 2015, pg 47
42
DECLG, Social Housing Strategy 2020, 2014, p.17
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 13of state support for housing43. Social housing channels include social housing, financial support and
housing associations. There were 106,575 households with support from rent supplement or RAS;
this amounts to 35 per cent of all households renting privately 44. In the same period, the proportion
of the population renting local-authority dwellings has fallen from a high of 18 per cent in 1961 to 9
per cent in 2011.45
Despite the overall fall in number, local authorities still remain the largest single providers of socially
rented housing in Ireland, owning approximately 107,000 dwellings. Tenants pay differential rents,
which are based on household income. The rents average about 15 per cent of this income, and in
2011 were €59 per week46. The level of rent charged is often not enough to cover maintenance and
doesn’t allow for reinvestment in more social housing, and as a result the local-authority social
housing stock is dwindling, and so is kept for the very poor.
We need to create institutions capable of achieving a resumption of provision by the local authorities.
In order to comply with Eurostat regulations in relation to maximum debt levels for EU member
countries, this institution would need to be a public corporation or a quasi corporation with income
stream sufficient to fund its own borrowing and sufficient income from rents to pass Eurostat’s
market income criterion. In the UK, housing-benefit payments by central government are part of the
sales revenue of council housing47, which is acceptable to Eurostat because it considers rent
supplements as part of an organisation’s sales revenue; even if these payments are a substantial part
of the budget of a social-housing provider, and so they do not lead to it being classified within the
government sector.48
We propose the setting up of a housing body or housing trust - linked to local authorities - that
would be outside the general government sector and provide a combination of affordable and social
housing. The institution should ideally incorporate the capabilities developed in the Housing Agency
and NAMA and could be an amalgam of the two. It would also incorporate existing expertise in the
Department of Environment, Heritage and Local Government, the Local Authorities and in the
Housing Associations and Co-operatives.
Community Land Trusts
One institutional arrangement that has been used in the US, Canada and the UK to ensure long-term
affordability is a community land trust. A community land trust is a non-profit legal entity that holds
land in perpetuity in stewardship for the common good. In terms of housing, the community land
trust model has mostly been used to promote a model of affordable homeownership (in which the
homeowner leases the land) but has also been used for affordable rental49. This development model
replicates that of the Irish ‘improving landlords’ of the 17 th to 19th century that has given us the
structured variety of Georgian Dublin as well as many fine towns and villages throughout Ireland.
The Green Party supports the development of community land trust in Ireland and would advocate
for the promotion of them legislatively and financially.
43
NESC: Social housing at the Crossroads, June 2014, pg 8
44
NESC: Ireland’s Rental Sector Report, May 2015, pg 19
45
NESC: Homeownership and Rental: What Road is Ireland On, Dec 2014, pg 7
46
CSO: Profile 4, A Roof over our Heads, Aug 2012, pg 59
47
NESC: Social housing at the Crossroads, June 2014, pg 46
48
NESC: Social housing at the Crossroads, June 2014, pg 36
49
Angotti, T, Community Land Trusts and Low‐Income Multifamily Rental Housing: The Case of Cooper Square, New York City, Working
Paper, July, Cambridge: Lincoln Institute of Land Policy.
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 14Approved Housing Bodies
Another possible vehicle for the provision of low-cost housing in Ireland involves non-profit
Approved Housing Bodies (AHB’s). There are around 300 Approved Housing Bodies in operation in
Ireland that offer low-cost rental on around 27,000 homes50. Housing associations’ dwellings
constitute a small percentage of total social provision and a miniscule share of overall housing. This
could be for many reasons including bureaucracy and need to put in their own financing or it could
be because housing associations are small players and not capable of delivering on the scale
required.51 The Green Party would support investigating the possibility of transferring the
management of current social housing stock into the hands of AHBs if it can be established that such
organizations are capable of handling such a large portfolio of housing.
Currently AHB’s are able to access low-cost loans via the Housing Finance Agency. Recent reports
suggest that some agencies are choosing to avail of commercial loans instead as they are currently
cheaper. The Green Party believes that it is important that we investigate whether the state needs to
buy out these loans so as to insulate the associations and the state from increases in market interest
rates. We also support investigating why finance from the Housing Finance Agency is not attractive
for AHB’s and remedies to make it so.
Cost-Rental
The Green Party is in favour of imposing a cost-rental model on social housing in Ireland. In Austria,
France and Finland, rents in social housing are cost-based and in Austria it is a requirement to
balance costs and revenue at the level of the individual development52. Basing rents on the cost of
proving accommodation has two positive effects; firstly, it provides the opportunity to pool the rents
from older low-cost properties and new higher-cost units, and secondly, when the cost-rental
segment reaches a sufficient share of the overall rental sector, it has the potential to moderate market
rents53. The Green Party acknowledges that determining ‘sufficient share’ to moderate rents is not a
simple matter and so suggest that financial projections are required to determine how big the social
housing sector needs to be in order for the cost-rental model to work successfully.
Currently in Ireland social housing tenants pay a differential rents, which are often well below the
level of cost-rents. We would advocate the topping up of such tenants’ rent by way of housing
benefit from the government. Since local-authority housing stock is largely debt-free, the costs are
generally fairly low except where significant refurbishment is needed. Therefore, if the state to
transfer local authority housing stock to AHB’s, these organizations could create a sinking fund for
new social housing from cost rents paid on low-cost local authority housing stock.
We recognise that this would need to be handled carefully to avoid Ireland breaching EU treaties that
disallow state aid to organisations for carrying out specific tasks where this aid distorts competition.
Therefore, Ireland would have to offer similar subsidies to profit providers unless it limited the
subsidisation of housing construction to that designated for disadvantaged citizens or socially less
advantaged groups that would not be supplied by the market without public intervention. In a Dutch
case on state aid to housing associations, the Dutch Government and the EU agreed that this aid
could be paid, providing that the housing associations rent only to a target group of disadvantaged
households. The European Commission has given member states a wide margin in deciding the size
50
NESC: Social housing at the Crossroads, June 2014, pg 12
51
NESC: Social housing at the Crossroads, June 2014, pg 13
52
NESC: Social housing at the Crossroads, June 2014, pg 36
53
Department of Environment, Community and Local Government, Social Housing Strategy 2020, Nov 2014, pg 48
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 15of the disadvantaged target group for social housing. In the Dutch case, the target group was set at
those with an annual income of €33,000 or less, which covers 43 per cent of the Dutch population.
This is a much wider group than the current Irish equivalent, where the lowest-income quartile makes
up 52 per cent of local-authority housing tenants. This suggests many opportunities to rent Irish
social housing to higher-income groups than those currently occupying it54.
Financing Social Housing
There are a number of ways in which governments can financially support the construction of social
housing.
Financial Aggregators
The Housing Finance Corporation (THFC) in the UK combines the credit needs of the small
housing associations and raises the finance to meet these needs as described in Chapter 4. There is
potential to develop such a ‘financial aggregator’ in Ireland. In a planned regeneration project
involving stock transfer of 2,000 local authority flats in Dublin, Cork and Limerick, it is intended that
a financial aggregator would be established and would borrow money from the EIB and lend this on
to housing associations. The European Investment Bank (EIB) has the benefit of a triple A credit
rating and hence is in a position to raise finance on very attractive terms. If successfully established
for this project, an aggregator would then be in a position to finance further projects 55.
Loan Guarantees
The provision of loan guarantees has become an increasingly used form of public support for social
housing. This applies in the Netherlands, France, Finland and some German Länder. In the case of
the Netherlands, the public guarantee has never been called upon as the social-housing associations
have their own system of guarantees. Access to private funding is increasingly important for social
housing providers. Providers in the Netherlands and England are now rated by international rating
agencies. Larger UK housing associations are able to issue their housing bonds. The Housing Finance
Corporation (THFC) in the UK ‘aggregates’ the credit needs for smaller associations and raises
finance to meet these needs. It then lends on this money immediately to housing associations on
similar interest and repayment terms. This makes it possible for associations to avail of finance on
more attractive terms than would be available from banks.
Discounted Price for Land
The provision of land at discounted prices to social housing providers is another important way that
social housing is supported.
Favourable Tax Rates
Some countries provide favourable treatment in the tax system to those providing social housing.
These include reduced VAT rates, reduction or exemption from property tax, and income/corporate
tax.
Low Cost Loans
Currently, the Housing Finance Agency offers low cost loans to those engaged in social housing. The
Green Party supports the continuance of this support as long as it is tied to the provision of cost-
rental social housing developments.
54
NESC: Social housing at the Crossroads, June 2014, pg 51
55
NESC: Social housing at the Crossroads, June 2014, pg 47
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 16In addition, Austria and France use tax incentives to facilitate the flow of savings to social housing.
Two-thirds of funds from the Livret savings accounts used in France are loaned to social-housing
organisations. The Livret savings accounts have similarities to the savings accounts offered by An
Post at present; in both cases the interest received is tax-free and state-guaranteed, although the tax-
free An Post accounts are for longer terms than the Livret accounts 56.
Active Land Management
Conversations about property tend to conflate two issues, buildings and land. Land is very valuable,
and increasingly so in urban locations. Buildings however are depreciating assets that need investment
to retain their value. We believe that a sustainable affordable housing strategy can only happen if the
government has a key role in the supply of land (Saiz, 2014 cited in NESC Housing Supply and Land
Report 2015) and so advocate the state having an active role in the supply of land in Ireland.
Active land management has long been a key policy in the Netherlands. Up until the early 1990s,
municipalities established land-development companies to undertake the role of land development.
This involved purchasing land from its original owners, subdividing it for different purposes,
servicing it and providing infrastructure. Finally, serviced land would be sold to developers, housing
associations (for social housing) and owner-occupiers. This process enabled municipalities to ensure
that their land development plans were realised. Also it allowed municipalities to recover the costs
involved in the necessary public investments through sale of the serviced land plots57.
According to NESC, the State now has considerable land resources that can be used for social
housing. This consists of (i) land owned by local authorities; (ii) land owned by the Housing Agency;
(iii) land under the control of NAMA; (iv) land owned by other public bodies that might be suitable
for social housing. It is important to note that this is a resource that can now be used without adding
to the government deficit and, although it must be ensured that the mechanisms by which it can be
used will fit with the state aid rules, it would be desirable to identify suitable land for social housing
and to make it available at low or nominal cost to social-housing providers. This move ‘effectively
replicates and extends the types of policy experiments that are already underway in the social housing
sphere (such as Dublin City Council providing sites for development), while also building on earlier
initiatives to facilitate planned development, such as the SDZs. 58
Following on from an assessment of existing land owned by the State, the Green Party advocates
that we engage in a major programme of state acquisition of land and derelict properties as envisaged
in the Kenny Report.
We believe that to safeguard this pivotal role in land supply management, the government should
never dispose of land zoned for housing in its ownership59 unless it can be shown that a more
appropriate land can be purchased with the proceeds from the sale of unsuitable land. The public
ownership of land would allow the government to raise equity for more social housing on the back of
any uplift in value of its existing developments.
This inevitably means that social-housing tenants would not be afforded the ‘right to buy’. Subsidised
homeownership for social housing tenants is often seen as a way of distributing of wealth within
56
NESC: Social housing at the Crossroads, June 2014, pg 47
57
NESC: Housing Supply & Land, July 2015, Appendix 1
58
NESC: Homeownership and Rental: What Road is Ireland On, Dec 2014, pg 20
59
NESC: Ireland’s Rental Sector Report, May 2015, pg xii
Copyright 2016 Green Party / Comhaontas Glas, 16/17 Suffolk Street, D2, Ireland. P a g e | 17You can also read
