"we may need to curb migration to solve housing problem"

[Brendan Burgess]

A very interesting article from Dan O'Brien

Home truth is we may need to curb migration

The rental strategy document contains a lot more than price cap measures. Most of it focuses - correctly - on the supply side of the problem. But there are no measures designed to lower demand, or even any analysis of demand side factors. In the short term, attempting to curb demand could be part of the solution. This could be done by slowing the issuance of work visas because official data shows that population growth in recent years has been driven overwhelmingly by people arriving from outside the EU (who require visas).

The CSO National Household Survey for the third quarter of 2016 shows that the number of Irish adults in the State rose by 10,000 over the previous five years, while the number of adults from EU countries (all the other 27 members) fell by 8,500. The number of adults from outside the EU increased by 37,000.
...

Currently, the work visa system looks at each application on a case-by-case basis. It doesn't consider wider impacts such as rent inflation. There is a case to broaden the analysis.

None of that is to say that dampening housing demand by lowering the flow of newcomers is in any way costless. As is the case with rent controls, there are a lot of negative consequences to cutting back on visa issuance.

The vast majority of people who get visas start working immediately on arrival. They create wealth and pay taxes. Lowering or capping the number of visas would mean forgoing these gains.

Of even more import is the wider downside. Ireland is a highly globalised economy with lots of highly globalised companies. Making it more difficult for them to bring their globalised employee base to Ireland would be damaging for their businesses and would likely make the country less attractive as a location for investment.

 

[Delboy]

How come we have a housing crisis when tens of thousands of Irish have left since the crash, when the CSO are telling us that immigration numbers are low.....it makes no sense. Unless the numbers coming in here are hopelessly understated and the numbers of non-nationals estimated to have left is also way out.
There's a numbers guy over on the Pin who has calculated 310,089 more PPS numbers issued according to the DSP v's the numbers for migration that the CSO have said have come into Ireland from 2001 to 2016.

I believe the census figures for non-nationals are very much understated. From what I have seen and read, and form talking to Eastern Europeans, Chinese etc over the past few years this has only confirmed it for me.
China has only 11,000!!! Nigeria, despite between 5,000:10,000 coming each year for many years at the height of the Asylum Claiming frenzy, has less than 20,000.

Whats driving the housing shortage of the past 4 years despite so many Irish having left???

 

[Brendan Burgess]

Interesting.

Would there be an issue with the emigration coming from areas where there is a lack of jobs and a surplus of housing?

 

[Delboy]

You mean inter-Ireland migration e.g. from the West Of Ireland to Dublin?
I'm sure thats a factor but an awful lot of people have emmigrated from rural Ireland to USA,London etc.

 

[jpd]

Using the number of PPS numbers issued as a proxy for immigrant numbers living here is not a very good indicator as numbers are issued more or less on demand and there is no record of when or if the person leaves the country or dies. And there could also be a problem with some people getting multiple numbers.

I would guess that the housing demand is driven more by the formation of new households as children grow up and leave the family home, by separations/divorces in the existing population rather than housholds arriving from abroad.

The real problem is the lack of supply - hardly any houses were built in the last 5/6 years and it doesn't look like that problem is being addressed in any meaningful way. The number of empty or vacant properties is a problem but many of them are in places where people do not want to live for one reason or another. Most of them should never have been built but lack of proper planning procedures could not stop them being built. If planning was done properly, they would have been built where they were needed.

 

[moneybox]

Interesting.

Would there be an issue with the emigration coming from areas where there is a lack of jobs and a surplus of housing?

How come there are 20,000 vacant properties in Dublin, it begars belief whilst thousands of families are left languishing in costly B & B's

 

[odyssey06]

I'm a bit dubious about how reliable these 'vacant' properties figures are... I wouldn't trust the census figures, I'd only trust utility providers saying no electricity \ water used.

The thing about arrivals from abroad is that they tend almost exclusively to concentrate in the areas of highest residential demand... they may not be the case about Irish people leaving the country. So it's probably misleading to compare the figures against the total population of the state. 100,000 people extra in Ireland may not seem like a big deal versus 4.5 million. But 80000 extra people in Dublin is.
Canada and Australia have policies in place that offer visas to immigrants but on condition of what province they base themselves in, for example.

 

[odyssey06]

Also I think Dan O'Brien makes an important point. Official Ireland made absolutely no provision in terms of services or legislation for the arrival of immigrants over the last 15 years. Everything was reactive. It simply is not good enough.

The state was very happy to pocket all the extra tax revenue from these workers, but were completely useless at dealing with issues like having a significant number of foreign licensed drivers on the roads, or getting non-denominational schools in place. If Poland wasn't a Catholic country, that non-denominational school system would have collapsed completely.
Ditto with the health service, happy to have foreign workers, not so happy to deal with foreign patients.
The waiting lists for someone working here on a VISA to bring in their spouse or children from outside the EU is closer to being measured in years than months.

 

[Delboy]

The Authorities weren't even reactive. They just opened the borders as good little Europeans oblivious to how many would come. Prionsias De Rassa a TD at the time of EU expansion reckoned we'd get 20,000 max moving here from Eastern Europe!!! They were clueless about what would happen.

 

[Gerry Canning]

From what I see our new arrivals contribute to our wealth , hard commentary on migrants is usually couched in the type of reasonable sounding (facts), whilst (blaming) them..
Our governments have let us and migrants down by their mis-management ,primarily in housing type issues.
Am with odysseys comments.
Moneybox . 20,000 empty houses in Dublin = madness .
Surely a near penal non-usage tax would quickly force movement on house sales/letting, or is that too simple ?

 

[T McGibney]

Our governments have let us and migrants down by their mis-management ,primarily in housing type issues.

+1

Moneybox . 20,000 empty houses in Dublin = madness .

No way are there 20,000 empty houses in Dublin. A large number of people are either ducking tax on rented properties or have other motives to tell porkie pies to the census man.

The non-response rate in recent UK censuses is around 6%. http://www.ons.gov.uk/ons/guide-met...census-data/response-rates/summary/index.html I looked online but couldn't find the corresponding rate for Irish censuses.

Surely a near penal non-usage tax would quickly force movement on house sales/letting, or is that too simple ?

That's all fine and well until its you or one of your family who have to spend a spell of time in hospital, residential care or (dare I say it?) prison.

 

[The Edge]

I think that quite frankly most of us don't trust the CSO census population figures. That is not even a criticism of the CSO census-takers - realistically they are not going to go into each house or apartment and count the people there.

 

[Jim2007]

Our governments have let us and migrants down by their mis-management ,primarily in housing type issues.

And if the government were to introduce the type of housing policies we have on mainland Europe, how many voters would back them??? In Switzerland you can aways find something to rent, if you are looking for something special you might have to search for a few months, but you'll not be on the street.

But it comes at a trade off:
- Home ownership is not encouraged, there are no special reliefs available and mortgage requirements are much higher than Ireland. And once you own a home your income taxes go up because are deemed to have an additional income equal to the monthly rental value of the property.
- Landlords: It really does not matter if they rent out their property or not, they still pay taxes on the projected rental income of the property. So if you don't rent it out you are going to have to pay the extra taxes out of your own pocket.
- Pension funds are required to hold a large part of their not investment portfolio in residential property
- Insurance companies are required to hold a large portion of the float in residential property
- All social housing is temporary and in most cases it consists of a rent allowance so you can go rent something
The emphasis is on make sure there is sufficient rental options available, not getting people on the property ladder etc.....

 

[odyssey06]

The emphasis is on make sure there is sufficient rental options available, not getting people on the property ladder etc.....

It's a chicken and egg scenario though isn't it?
People wouldn't feel the need to scramble onto the property ladder if they felt they could rely on the rental market.
I wouldn't want to be 65 relying on Dublin's rental sector to meet my property needs... or be too keen to have to fund decades more rent during retirement.