Shortage of new homes splits the country while developers shun regional counties

One expert said the Government’s aim of balanced regional development looks impossible and that Ireland is at risk of becoming a city state “like Luxembourg”.

While housing is in short supply almost everywhere, house-hunters outside Dublin and its commuter belt have even less chance of finding a home than their east coast counterparts.

Central Statistics Office (CSO) figures show the top-performing local authority area, South Dublin, had one new housing unit started for every 83 people living there last year.

The worst performer, Roscommon, had only one for every 648 people.

Over the past three years, the counties that most frequently featured in the top 10 were Dublin city, Fingal, Dun Laoghaire-Rathdown, South Dublin, Wicklow, Meath, Kildare, Louth, Laois and the outlier, Cork County.

Longford, Roscommon, Tipperary, Leitrim, Kerry, Donegal, Mayo, Sligo, Cavan and Clare featured most frequently in the bottom 10.

“It’s a chicken and egg situation,” said Michelle Murphy, a policy analyst with the Social Justice Ireland think-tank, who relocated from Dublin to Donegal in the last few years.

“I don’t know if all the house-building goes to the eastern seaboard because that’s where the demand is, or if that’s where demand presents because that’s where the homes are being built.

“But I do know the radio programmes I listen to here and newspapers I read locally are full of stories about people needing housing.”

Professor Padraic Kenna, director of the Centre for Housing Law, Rights and Policy at University of Galway, agrees.

“It’s not a shortage of demand, because there’s demand everywhere around the country,” he said. “And it’s not a shortage of money, because when you look at the number of first-time mortgages drawn down, it’s as high as at the height of the Celtic Tiger.

“There are complex dynamics going on at the core of the construction industry. It doesn’t make decisions on the basis of population density.”

Whatever the dynamics, the result is clear. According to CSO figures quoted by the Department of Housing, housing completions (these differ slightly from commencements) last year grew by 21.9pc in Dublin and 32.2pc in the midlands.

They rose by just 8.3pc in the south-east, 5.4pc in the west and 1.2pc in the south-west.

In the mid-west region there was a decline of 1.4pc and the border region had a fall of 1.7pc.

“The rate of decline is decreasing at a regional level,” the department said.

Maybe so, but the concentration of homes on the eastern seaboard will not be diluted any time soon.

Dr Lorcan Sirr, senior lecturer in housing at Technological University Dublin, has crunched more numbers.

“In Co Dublin, in the four local authorities, you’ve got 28.5pc of the population living on 1.3pc of the land,” he said. “In the greater Dublin area, which includes your commuter belt counties Louth, Meath, Kildare and Wicklow, you have 41pc of the population living on 9.5pc of the land.

“In Co Galway, you have 5pc of the population living on 9pc of the land. In Connaught, you’ve got 11pc of the population living on 25pc of the land.

“Development is so very heavily weighted on the east coast – how are you going to rebalance this lop-sided country?

“The country has gone so far down the line of becoming a city state like Luxembourg that Dublin is now like a bowling ball and everywhere else is like marbles.

“Balanced regional development is a politically convenient concept, but nearly impossible to achieve.”

The difference between impossible and nearly impossible?

“One hundred years,” Dr Sirr said. “I think it would be a 100-year project.”

We should be 20 years into that project, as the National Spatial Strategy was devised in 2002 to achieve more balanced regional development. It did not have the desired effect.

The National Development Plan and National Planning Framework state similar objectives, but their first versions were published in 2018 and evidence of progress is slim.

Prof Kenna believes the construction industry “seems almost immune from all kinds of policy decisions”.

“You can zone [for housing], but the local authority has no power to make people build,” he said. “You can have a great county development plan that tells you exactly how many houses you need, but to get them delivered? That’s the weak link.”

When the Irish Home Builders Association was asked what policies would boost housing supply in regional counties, director Conor O’Connell said trends were already improving.

“All regions are now experiencing an increase in both completions and commencements,” he said in a statement, although this contradicts the CSO figures. “Some of the largest percentage increases are occurring in counties outside the main urban centres. For example, Westmeath, which up until recent times saw little housing construction activity.”

Mr O’Connell said government initiatives such as Housing For All, Project Tosaigh, Croí Cónaithe and rebates for development contributions and water connections are working

“Many of these are in their infancy, but are yielding an increase in housing output,” he said.

However, Dr Sirr has doubts about their efficacy. Croí Cónaithe is too restrictive, he said, requiring a density and height of development beyond the experience and reach of most small and medium building firms operating in the regions. He is also concerned that the rebate scheme may give a false impression of commencements.

“What you have people doing is getting a commencement notice which costs €30 and lasts for ever to avail of the exemption without necessarily intending to develop,” he said.

“They can put a man with a shovel on site to dig a hole within 28 days to ‘commence’ work, but then sit on the site and sell it on when the market suits.”

It will take time to see whether that ploy proves widespread.

The Organisation for Economic Co-operation and Development (OECD) has seen enough of Ireland’s attempts at balanced regional development to know it is not working.

In a report published last December, it said the imbalance in regional development was matched by “uneven governance”.

“Policy development on issues of local and regional concern – the most pressing of which are investment in housing and transport infrastructure – largely takes place in Ireland’s capital city, Dublin, where much of the central government public sector is located,” it said.

It also highlighted one event that fed into its analysis.

“A local authority presentation in Sligo noted that the National Planning Framework targets are impressive and benefit the region – but the delivery has been weak. For example, in the last year, about 170 units were built versus a need for closer to 600 to meet NPF targets.

“Despite the quality-of-life advantages that Co Sligo boasts, there is simply limited choice and, as a result, high prices for potential newcomers seeking a place to live.”

The Department of Housing insisted the NPF would see “substantial growth occurring in the southern and northern and western regions”.

It said the various schemes already mentioned, plus the Vacant Home Refurbishment Grant, the Rural Regeneration and Development Fund (RRDF) and the Town and Village Renewal Scheme, would all yield results.

Ms Murphy of Social Justice Ireland said she is worried the results would not come fast enough or be as substantial as needed.

“Schemes like the vacant homes initiative are quite limited. The scale of work needed on most vacant homes is so great that the grants don’t help much,” she said

She pointed out that current rural housing guidelines are 20 years old and a revised version promised since 2017 has still not been published.

“We need those guidelines. It would give more certainty to builders and it might get them looking more favourably on the regional market,” she said. “If you really want balanced regional development, people have to have somewhere to live.”