• Wednesday , 26 July 2017

Repetitive Crisis – Housing in Dublin

Dublin County Development Plan, 1972 (Source: Richview Map Library, UCD) Dublin County Development Plan, 1972. (Source: Richview Map Library, UCD)

“The housing problem is fundamental to the problem of labour, since the house is the central and fundamental fact of wages.”1

During the 1990s, house prices were relatively comparable with incomes, costing four times the average industrial wage.2 With an expected population growth in Dublin, the demand for housing was growing. In order to keep up with this, the 1993 Development Plan for Dublin supported tax incentives for the further development of the Western Towns (Blanchardstown, Tallaght and Clondalkin) as suggested by the Wright Report in 1966. There was a specific emphasis placed on Blanchardstown, as this was the smallest of the three towns.3

With demand pushing prices up, a second-hand home rose to sixteen times the average wage.4 This astonishing rise in such a short period of time was also reflected in mortgage lending. Throughout the late 20th century, banks had been quite conservative with their lending. This changed after 2000 as a convergence of economic conditions meant that money, of almost any amount, could be borrowed on international markets without security, at rates only slightly higher than those offered by the Central Bank.5 This relatively cheap credit drove a lending boom in Ireland, which in turn fed the property boom.

 

Development Plan for Dublin, Wright Report (1966) Development Plan for Dublin, Wright Report (1966).

The aforementioned tax incentives encouraged an exponential rate of construction in Blanchardstown, where the population grew from just 3,000 people in 1969 to over 98,000 people in 2011.6 This sudden upturn utterly transformed the rural landscape of West Blanchardstown into a sprawling suburb, skirting the border of Meath.

The 2006 census was a key turning point, highlighting with the tangibility of statistical data that there was an oversupply of houses.7 In many respects this realisation came too late, as at this point the Irish economy had become utterly dependent on the construction industry with the government relying on this activity for 15% of its income – three times the EU average.8 To make matters worse, 83 cent of every euro borrowed in 2006 was property related.9 When the property market crashed in 2007, both the banks and the government were left frighteningly over-exposed.

 

Figure_11 New House Registrations in Dublin by Year, 2000 – 2010. (Source: CSO)

As a result of the crash, there were over 2,800 ghost estates, left unfinished around Ireland.10 Construction ground to a halt and the landscape left littered with the physical remains of the Celtic Tiger. Due to the subsequent recession, there were just 140 houses completed in Dublin in 2011, in comparison to over 17,000 houses in 2006.11 Dublin has been in a constant state of housing crises since the middle of the 1990s. Whether it has been too few houses or too many houses, we have failed to adequately manage our housing stock with disastrous consequences for the built environment of our city.

As we face yet another housing crisis the question remains: how can we resolve this without causing another bubble?

1 Patrick Geddes, Dublin Housing Inquiry, Excerpts from Evidence (Dublin: Dollard Printers, 1914).

2 Morgan Kelly, ‘What Happened to Ireland?’, Irish Pages, Ireland in Crisis, 6, no. 1 (6 August 2011)

3 Dublin County Council, Dublin County Development Plan 1993: Written Statement (Dublin: Dublin County Council, 1993).

4 Kelly, ‘What Happened to Ireland?’.

5 Kelly, ‘What Happened to Ireland?’.

6 Central Statistics Office, ‘Census’. (2011)

7 Ronald Quinlan, ‘“I”m Sorry for the Bubble… Sorrier for When It Burst’’, Irish Independent, 30 November 2014.

8 Kelly, ‘What Happened to Ireland?’.

9 David McWilliams, The Generation Game (Dublin: Gill & Macmillan, 2007).

10‘ Where Are Our Ghost Estates?’, The Irish Times, 26 January 2013

11  CSO, ‘New House Registrations by County and Year”

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