Same old housing bubble, same old hypocrisy

Ireland is re-entering on the path it’s tread several times before.

Housing is the flavour of the day, at least as long as there’s a mortgage on it. High house prices are again a good thing.


Recently the Central Bank tried to bring in some measures to reduce the madness, opposing 100% mortgages. There was a flurry of politicians, including many from the government, saying how dreadful this was and that it would “lock young people out of housing”.  It is, of course, hypocritical nonsense.

I tried to summarize some sense in a letter to the papers.  But I fear that the dodgy politicians have an all t00 willing audience on this topic. The Irish general public want to spend all their money on houses. Apparently there’s a consensus that it’s a good thing to have young people borrowing huge amounts for housing in a country that’s almost all open land. And even in Dublin some simple steps could resolve the housing problem in short order. But don’t hold your breath.



The usual Irish political hypocrisy on housing is returning to historic levels. While govt TDs and  ministers complain about how a rule requiring 20% deposits will “lock young people out of housing”, it is government policy that is largely responsible for high house prices in one of the least built up countries in the OECD.
Development levies on new housing, yet no effective property tax or land tax.VAT on housing construction. Effective limits on competition in the Irish bank market driving mortgage rates much higher than most EU countries. Effective prohibition on eviction of mortgage defaulters restricting supply and forcing interest rates higher. Market manipulation to recapitalize the Irish banks and protect the taxpayer (or their pensions). No reform in the rental market making long term rental an unpleasant and unstable option.
There is no end to the hypocrisy. It is explicit Irish government policy to inflate house prices. This, more than anything, locks young people out of housing. Yet you can continue to expect the politicians to blame the Central Bank. It’s all a lie. Again.
Yep – once again, letter writing is the lowest form of political expression. Apart from being a supporter of Sinn Fein.

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