We’ve talked enough about the housing crisis. Here’s a radical plan

We are in the midst of the worst housing crisis since the foundation of the State. There was almost unanimous agreement among delegates at this week’s National Economic forum that the lack of homes is one of the most urgent issues we face.

Housing is jeopardising the economy, limiting the capacity of business and threatening the ability of key public services to operate. It is resulting in a level of social trauma that is completely unacceptable in one of the wealthiest countries in the world.

Yet, at this point of unprecedented level of housing need, what is happening? The supply of housing is falling. Last month was the eighth consecutive month that activity in the construction sector fell, as shown by the construction index.

New home commencement figures show that housing output will actually fall this year to just 27,000 units, down from 30,000 in 2022. This is market failure. The private market is not delivering homes at the scale or speed required to meet the needs of the Irish economy or society. But it is also a State failure. Successive governments have reduced the State’s own capacity to deliver housing, and handed housing supply over to the market. These are the fundamental causes of the housing crisis.

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A new approach is urgently required. A key solution is the Irish State getting back into delivering housing on a major scale through local authorities and housing associations and also new approaches that can deliver rapid results.

The way to do this is through the formation of a State-owned national sustainable home building agency.

This public agency – our suggested name is Homes for Ireland: the Irish Sustainable Home Building Agency – would directly build new homes and employ directly all the expertise required to deliver housing from preparation, planning, architectural design, financing and building. The agency could attract construction workers (professionals and trades) with permanent contracts of employment in a singular enterprise, in contrast to the wider precarity in the construction sector.

The State has the land and it has the finance. So why does it not deliver homes itself through a national building agency?

This would be a way to rapidly build key skills in one public agency and would create a permanent capacity of housing construction skills within the public sector. The State employs 41,000 nurses and 64,000 teachers to guarantee delivery of quality public health and education. Housing is as fundamental to our lives as health or education. Yet there is no such State employment to directly deliver housing.

Within three years, the agency should be aiming to directly deliver 10,000 social and affordable homes per year. This would be in addition to the current delivery by local authorities and AHBs, resulting in an overall build of 24,000 social and affordable homes per year - in contrast to just 8,500 social and affordable homes built in 2022 (which is 60 per cent below the Housing For All target of 14,000 per year).

These 10,000 homes would include directly building 5,000; refurbishing another 2,000; delivering 3,000 through modular housing delivery, as well as a programme of retrofitting.

An organisation with a singular focus on directly delivering housing would be able to deliver at scale and speed. Current methods of delivering social and affordable housing in Ireland are uncoordinated and inadequate, because there is no responsible public agency with oversight. There is also a lack of direct construction delivery skills and an over-reliance on the private market. Ninety per cent of the total social housing output (19,938) in 2022 was either bought, leased or rented from the private market.

The State has the land and it has the finance. So why does it not deliver homes itself through a national building agency? The operating model of the agency would be to develop and build its own mixed-income public housing developments itself on public land, and retain ownership of the land, holding on to these homes as permanent social and affordable housing stock. But it would also build on behalf of, and in partnership with, local authorities and AHBs.

This would also facilitate investment in modern methods of construction – such as setting up modular factories to deliver housing at scale.

This agency would be responsible to the Minster for Housing, and it would co-ordinate housing delivery nationally, alongside continuing to support and enhance local authorities’ role in housing.

Housing needs to be treated and delivered as an essential public good, a public service, a human right

This state construction enterprise would also provide the construction skills, co-ordination and capacity to refurbish, retrofit and upgrade housing and buildings – helping to achieve our climate targets in housing and bringing into use our huge vacant and derelict stock.

Setting up a national building and retrofit agency is both a short-term emergency and longer-term strategic enterprise. Drawing funds from the budget surplus into setting up a public sustainable building agency would be one of the most strategic and effective uses of this huge financial resource.

We have seen the State respond in an emergency way, swiftly and with unlimited resources, to other crises and emergencies: bailing out the banks, setting up Nama, implementing emergency health measures during the Covid pandemic. We need to see a similar emergency and unlimited response put into solutions to the housing and homelessness crisis.

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The Irish State has a proud history of delivering public housing and it must do it again, but in a modern and appropriate form for today’s Ireland.

[ Ireland’s housing crisis facts and figures: All you need to know ]

Housing needs to be treated and delivered as an essential public good, a public service, a human right – not an investment asset. Just as the public Electricity Supply Board (ESB) company rolled out electricity across the country in the 20th century, a home building agency would guarantee affordable and sustainable homes for all. The choice is stark. We stick with the current approach, muddling along, with the crisis worsening – rising homelessness; a generation stuck living at home into adulthood; young people forced into emigration; schools and hospitals closing because lack of teachers and nurses; and other long term social and economic costs – or we take radical action.

Dr Rory Hearne is a lecturer in social policy at Maynooth University and author of two books on the housing crisis. Phil Murphy is a housing researcher