The Government’s Housing for All plan preceded Budget 2022. Our analysis of this plan shows that it fails to recognise the true scale of the housing crisis and Budget 2022 seems to fall even further behind.
The commitment in the plan is to build 33,000 new homes every year, including 90,000 social homes over the period 2021 to 2030. A look behind this data indicates that these targets are insufficient to meet the real needs.
Housing Need and Demand
The Government based this target on its Housing Need and Demand Assessments (HNDA) and research conducted by the ESRI. The difficulty is that these projections are based on the new household formations and do not take account of the years of under investment in the sector.
Budget 2022 commits to ensuring that people have access to home ownership and views the provision of housing as a priority. This will prove difficult if the build and acquisition targets are not based on or linked to the real needs being experienced.
In 2014, the ESRI projected an ongoing need for at least 25,000 new dwellings a year over the following 15 years. This estimate was revised the following year to approximately 27,000 new dwellings each year between 2016 and 2018, increasing year-on-year from 2018 to reach over 30,000 in 2024. it is important to note that this and subsequent ESRI research in this area does not factor into its account the full extent of housing delivery or the 90,500 households in ‘pent up demand’ and could therefore be considered a conservative estimate. By only looking at future demand and not taking into account current and unmet requirements, these 90,500 households are not being considered.
Budget 2022 reaffirms the Housing for All commitment to an average of 9,500 new build social homes per year. Added to this are 4,000 affordable purchase homes and 2,000 affordable cost rental homes out as far as 2025. If delivered over this time span, there will be 62,000 homes built which is to be welcomed but realistically meets neither current nor built up demands.
Budget 2022 commits to increase the current spend by an additional €168 million or 7 per cent. This will support an extra 14,000 tenancies through the Housing Assistance Payment (HAP) support, bringing the total to 66,000 households. HAP, delivered via the private rental sector, ultimately does not deliver secure, stable housing and highlights the difference between social housing and social housing supports. It is a temporary housing support and many of these 66,000 households will most likely still require social housing should their HAP tenancy expire.
Ensuring an adequate supply of affordable land is available to build on is key. Budget 2022 does not make any reference or commitment to advancing the Land Value Sharing measures discussed in Housing for All.
Budget 2022 does introduce a Zoned Land Tax, the aim of which is to increase the supply of land suitable for the building of residential accommodation. The lead-in time of two years for land zoned prior to January 2022 and three years for land zoned after this date is too long and it is possible to have suitable land rezoned which means this may not be the initiative that is needed to really meet the scale of the challenge.