30,000 empty homes and nowhere to live: inside Dublin’s housing crisis
theguardian.com
theguardian.com
Two straightforward treatments I’d want to see tested:
1. A significant “hotel tax” or “vacancy tax” to make it very expensive to let housing sit idle. Reduce the profitability of tourist rental and units will shift back to local rent.
2. Significantly expand the supply of housing by removing barriers to development. This phenomenon is happening around the world as cities try to keep existing neighborhoods under glass and prevent any change, damning younger generations to have no place to live.
Another thing I would love to see is the development of new cities with robust transit connection to the nearby older ones. I don’t know enough about Dublin to be specific, but I do know that across the US one of the things that is happening is a generational trend toward wanting urban living, to the point that many people don’t even consider living in suburban or rural towns. However there’s no reason we can’t build new “urban” cities: places starting with a Main Street, compact walkable design, street grid, designed to organically scale up to a genuine large urban center over time. This was common practice in the 1800s, and we have plenty of models around the world to copy from, we just quit doing this in the car age. Why not bring this back?
That's quite broad. Barriers to development were lowered and ignored during the Celtic tiger era.
Really poor housing was built and funnily enough, it was still sold at obnoxiously high prices.
The only people pushing for this are property developers and thankfully so far, most of the country has remained strong on not falling for this spiel again.
*This doesn't exclude building higher in city center.
Incidentally, this is part of why I'm moving to a house near Tullamore in a couple months. It's 53 minutes by train from Dublin (Heuston) - and yet off the radar of my friends, some of whom spend that much time commuting to work via bus from within Dublin city.
For what it's worth I made a site where you can see places for rent and sale and how far they are from job centers via rail (and the schedules)
the second point you made is a well known issue across the world, it simply comes down to a politically correct version of red lining. the terms are changed to make it palatable but the effect is the same. those in need are forced out, their presence is only desired during work hours to perform work
A house that's empty most of the year really is making the problem worse, and if they don't want to change then they can pay some money to offset the harm.
The point of the vacancy tax is to prioritize the limited local space for the local population who live and work in the city. Vancouver is implementing a mild version of a vacancy tax to curb the issue with empty houses.
supply, demand, not everything is broken down into your simplistic libertarian alegbra.
Well said. And the article makes a mess of it - discussing so many things without actually discussing the causes of homelessness - mental illness, lack of skills, the need for daycare, handicaps, and myriad others. Plus, the big one advocates like to pretend doesn’t exist - drug addiction.
Why? Because dealing with the root causes is really hard. So much easier to blame something else. E.g at one point it says there’s a total of 1,400 homeless in Dublin and earlier says “3,165 entire properties listed on Airbnb in Dublin, compared with only 1,329 available for long-term rent“.
Since only a small portion of long-term rentals are available at any point in time (the total number of long term rentals could be what - tens of thousands?) one might wonder why those numbers were used or if the guardian has vindetta against Airbnb...but reguardless...
If there’s 1,329 available for for long-term, why aren’t they putting the 1400 homeless in them? That would leave only 71 homeless! The rest could go to Airbnb...done. Problem solved.
But of course, it’s not solved.
And as for why homeless are placed in hotels rather than Airbnb or long-term rentals - its likely because its easier to contact a few large entities (hotels) to arrange lodging than it is to contact 1400 individuals. That and the neighbors might not be to happy.
The next time there's a recession, things like this will only worsen it because people will be foreclosing on large numbers of housing properties because they were used for investment.
Smart investors use other people's money and hope for the bailout.
Galaxy brain investors use other people's money and write the bailout.
While some of us might not believe this, there are enough people who see real estate as such a safe investment. Some of them are from other countries and they're looking for a place to park their money that's not a bank or volatile like the stock market.
> you can invest on loaned principal without extreme risk in case of failure
Yes, when this happens thousands upon thousands of times you have the 2008 world wide financial crisis.
Further, unlike stocks, buying/selling houses incurs fees (round-trip fees can be anywhere from 5% to 12% depending on your city/state/country), so really, a house going down 15% is like you going to zero.
Housing cannot simultaneously be affordable and a good investment. Affordable housing means existing homeowners lose equity.
https://toronto.listing.ca/condo-price-history.htm
Which means rich people end up hoarding property. You don't even have to rent it out. Just wait a little bit and make a bank.
Great quote that applies worldwide. And agreed its dumb. Hotels should be most efficient, I dont know how houses can be cheaper.
Alone a 24h reception will cost you. 3 people around the clock? Weekends? How many rooms do you have?
Houses can be cheaper if we allow building more of them. Right now supply is heavily constrained by zoning and density limits.
"The new law allows short-term rentals to be offered only by owners who live in the properties they rent out. Owners of small multifamily buildings who live on premises may also rent out one of the other units in the building along with the unit they live in."
https://www.avalara.com/mylodgetax/en/blog/2018/06/boston-ci...
These apartment blocks are _homes_ for most people.
Vancouver just enacted a similar law to Boston's - AirBnbs only allowed in a secondary suite in a primary residence. In exchange for being allowed to continue operating in the city, AirBnb requires a city business license (which is only granted for secondary suites) from all Vancouver BnBs, and forwards the list of all BnBs to the city every month. Then if an address doesn't match up with a business license, the city fines the property owner. If you don't pay, the city takes you or your house to court and you get a nice fat lien on the property.
This doesn't seem to work as well with condos and apartments, though. I think the city has left enforcement up to strata orgs which is probably a mistake?
This would crash the property market but it would make flats available nearly to all who need it.
Flats can't be both affordable and good investment for superrich.
Top 500 richest folks got their money differnt ways but the most common source is real estate, usually 3rd generation of hoarders.
Between 1950 and 1959, he notes, the highest earning 1 percent of Americans paid an effective tax rate of 42 percent.
https://slate.com/business/2017/08/the-history-of-tax-rates-...
Not supporting the silly 10 apartments thing.
I'm just pointing out that progressive taxation, even with very high top marginal rates, is not socialism - and we do ourselves a disservice when we pretend it is.
What does it have to do with you and your wealth you've gotten from them for free without even lifting a finger?
Just want to make sure those who got there money from the parents do participate as well.
People get high and might and see it as some sort of double tax, inheritance tax is the price heirs pay for receiving money they didn't earn through their own means.
I'm not saying every penny should be taxed, sure have a threshold.However if you are 35 with no great skills and just waiting for a grand-parent to pass and inherit $/€/£3m. With the sole aim of buying 5-10 apartments and living off punitive rent you charge others who don't have rich grandparents, then you should be taxed to the hilt.
"However if you are 35 with no great skills and just waiting for a grand-parent to pass and inherit $/€/£3m. With the sole aim of buying 5-10 apartments and living off punitive rent you charge others who don't have rich grandparents, then you should be taxed to the hilt. "
Everyone should be equal in the eyes of law - this is anything but that.
It is not about child's right to that wealth - it is about parent's right to give it to their children.
Children inherit lots of things from their parents like their genetics, upbringing, location, food, clothing and a place to live without paying taxes on those things so why should the inherited money or property be taxed? All of those things "fell from the sky", how is money different?
That said I think inheritance tax is very bad idea and shouldn't exist.
Tax is so low right now that you can sit on whole lot of properties for years and not even bother to rent them and still not loose much money.
That seriously harms others and should be at least effectively discouraged.
That's inconsistent.
Many people actually take pleasure from paying taxes. Weird. I know.
What more is there to tax?
The fact that income paid to interest is not taxed, yet income paid to rent is taxed can create a significant advantage to owning versus renting.
As a side note I think income tax should be 0. VAT as the main source of income seems way more just to me. Plus various taxes to make the environmental cost of activity known to the market (like CO2 tax, fuel tax) or tax on harmful things (like tobacco) to discourage them.
>Taxes gathered this way should found basic income.
...which is going to turn off some people, while others will consider it an unnecessary political tangent.
Bingo.
Actually, there's a stronger statement, here.
Housing can't both be affordable, and be a good investment.
Pick one.
Landlord spends that 12k on fun activities. They pay 23% VAT
The government is making an absolute fortune with this absurd rental market.
Let's not even get into the high cost of mortgages because the government has a non trivial share in banks after they went bust 10 years ago.
Maybe that means massive taxes on the property if the owner isn't using it as a residence for at least 1/3rd of the year (to allow for snow-bird dual-home setups that are popular).
Ireland's culture seems to me a strange mix of great heart, fatalism, happy go lucky attitude, greed and complete inability to plan the future.
Check this: an Irish comedian around 2008, when the crisis hit Ireland and the properties prices crashed:
In Dublin, there have consistently been more complete units for short term let in any moment on AirBnB than there are units available to rent.
Introducing new supply won't solve the problem but it will significantly ease it.
from roughly 2000, to 2010, things got much better, it actually felt like a renters market at times. You could rent a whole house in the city for a reasonable amount, and tenancies could new be registered with the PRTB. So both parties had protection.
After that I found things gradually harder and harder. Harder to find a place, more crummy places for more money, landlords no longer registering with PRTB, doing whatever they want again, cus they know any tenant will have to put up with it and just feel lucky to have a place.
In 2016, I had had enough of it. I moved down to the country. It was a great move, I can go on great walks and cycles from my door, its quiet and peaceful, and I am avoiding all the noise, air pollution, scumbags, and issues of housing in Dublin.
I kept my lump sum that I had almost used to get a mortgage to get a house in Dublin.. and now I'm just living off of it without needing to work for a few years. :)
For as long as I can remember there have been calls to decentralize government infrastructure to rural locations to both ease the resource demands in Dublin and to allow people in the countryside to get a job near their families. By and large it has not happened. And when that has been coupled with the actual shutting of rural services (An Post, hospitals etc) using the excuse of austerity (itself triggered by housing speculation) the situation is just exacerbated.
Good luck in Offaly. I chose to move abroad over a decade ago instead of dealing with the implications of a gombeen state.
I do work remote. Will be about 12 minute's drive from Tullamore, which is 53 minute train ride from Dublin. Hospital and even a greenway for cycling not too far. The long term plan is to structure life to be low overhead and be able to work for ourselves, do some permaculture as well.
Considered other countries but Ireland has been pretty good to us (crap bike infra notwithstanding) and, well, life is a long and winding road. I'd never get a house cash an hour from the job centers of my former home (Northern California).
I guess we'll have to invite some guys from Poland. Oh, wait...
People think by increasing regulations on house owners that this will be solved. This is false. Decreasing regulations allow more business men to invest in housing in the city. This increases competition in the long term, thereby bringing costs down.
Instead of increasing regulations on Airbnb letters, why not decrease regulations on renters and provide incentive?
The solution is for the government to behave if a countercyclical fashion: if the market isn't doing its job, the government has to compensate for the market failure.
The title of this submission mentions 30k EMPTY houses sitting idle, and the solution is build more?
What makes it so undesirable that the article protagonists are willing to put their kids through the wait in what is basically a shoe box?! (10 sq.m. is not big enough for two people!)
The risk of having to look for another place to rent in a year is the same in most of US. They appear to be protected from the increases by the subsidy, so doesn’t feel so bad.
Funny how the locals pay for all of the upkeep or historical sites, and I get to see it for free or nearly free.
There needs to be regulation that makes it easier for the tenant to also be the owner.
Maybe i wasn't clear, but my point was that when renting is the most common way of living, it is not healthy for society.
Ownership promotes community and responsibility. Renting is parasitic and enables social stratification in to elites and tenants.
Prices are inflated and are used as investments rather than housing. This is where the government needs to add regulation to prevent exploitation of the market.
Germany (with it's sane housing cost growth) would disagree with that.
> Renting is parasitic and enables social stratification in to elites and tenants.
Not really. Renting provides accommodation mobility. Done correctly, it can be liberating & very valuable for state, renter & landlord.
Housing is scarce, always has been. The prices are not "inflated", they are merely a symptom of the underlying reality which is that there's only so much housing to go around and given the option of making money (renting) and making a lot more money (airbnb), landlords will obviously choose the latter. My guess is a majority of these so called landlords are of modest means and would be harmed significantly by overbearing rent control programs. The only sensible solution to this problem is to enact policies that encourage developers to build (increased supply will lower rent costs) or enact policies that somehow limit the number of tourists coming to Dublin (doesn't seem reasonable or desirable). Any attempt to artifically manipulate the price of housing up or down via regulation will at worst, end in disaster or exacerbate the current crisis.
We also have a lot of voters for whom rising house prices are a good thing. Homeownership rates in Ireland are high compared to the rest of Europe and plenty of people were underwater from the mid-2000's until recently.
Dublin needs to get rid of height maximums in the core of the city, build a transport network not suited to the 1950's (it's shockingly car-dependent and sprawling for Europe), and maybe not trap every project in planning hell. It suffers more generally from a labrynthine complex web of agencies and politicians - how can a city this small have sixty-freakin-three councilors? We're only 1.2 million people. And yet we wind up with things like the city council drawing up plans for a bus lane without realizing someone's already got permission to put an apartment building on the same land. https://www.dublininquirer.com/2015/06/30/for-favoured-liffe...
Of course, our agency tasked with bringing in foreign investment is just pretending none of this is a problem https://www.independent.ie/business/irish/ida-chief-denies-c...
Those reading this - keep in mind that yeah, it's cheaper than SF, but wages are substantially lower too.
I actually really like Dublin, and I am grateful to the Dubs for making me feel welcome (I'm from California) but I got INCREDIBLY lucky moving here in 2013 and walking in to a flat (the economy was on its knees then). I am aware that as a tech worker who lives in a prime spot in Dublin with rent control I am part of the problem. However, I'm also moving to the midlands in a few months, so that should free up at least one flat.
1) Tax based on property value (ad valorem); 2) Ad valorem deduction if owner lives on property (homestead exemption)
PLUS some tax distinction for "declared" - not sure if verifiable - long-term (6 - 12 month minimum) vs short-term (AirBnB) rental.
I think taxes might work better or at least sound less draconian than simply banning AirBnB or restrictions such as when rooms can be let (e.g. Jacksonville Beach FL had some kind of ordinance restricting lets to certain months of the year.)
First, the journalist writes:
"The Greater Dublin area is reckoned to have more than 30,000 properties that are completely empty, many of which are owned by the local council."
However, they then don't get a quote from the council saying why their properties are empty.
That tells me they had a specific story they wanted to tell, without digging into why the systems the country has (state housing) to provide assistance aren't working.
It's a fine place to visit but no way I'd live there (again). Traffic woes, housing woes etc. I dunno how the Dubs do it tbh.
The country just build HOUSES for few people and nothing high or apartment blocks... Again, instead, we build offices.
Truth is Dublin is one of the most appalling cities in the world.
They should try Stockholm. It can't be worse than Stockholm, surely.
It is probably time for compulsory purchase orders at prices fair to the taxpayers. Hopefully this will scare off other predators as Ireland becomes known as a bad place to do dirty business in.
((I am dreaming... that will never happen... the Irish public by-and-large are neoliberal true believers... these are the fruits of their dearly held ideology))
Housing shortages are almost always a market failure due to regulation of some sort. They keep talking about it like the problem was existing landlords/AirBNB and to whom they're renting it out, etc. Instead of focusing on the real problem: lack of supply.
I think that's important--letting experts or ideas be wrong. I don't see evidence of humanity having success solving difficult problems without competition and experimentation.
But this particular problem will continue to grow because it wont be addressed in this way. Committees, bureaucracies, academics and journalists will surely discuss it though.
Orwell speaks more eloquently about this concept in The Lion and the Unicorn.