House price inflation eased – a little – in October, according to the latest figures from the Central Statistics Office, but at close to 10 per cent the annual rate of increase is still very concerning. More and more people are being priced out of the market as chronic undersupply continues. Those who can afford to buy are often doing so with the help of parents and by taking out significant mortgages.
Meanwhile, the supply of new homes this year is unlikely to exceed the 33,000 built in 2023. Forecasts from the outgoing Coalition that the number would approach 40,000 look unrealistic on the basis of the figures already published.
The next government needs to start its housing policy by accepting one thing, which is that the existing policy is not achieving enough. This will be politically awkward. But the alternative is to pretend that everything is okay and allow the crisis to roll on. Promises of more than 50,000 new homes being built will count for little, unless the policies are put in place to achieve this. And this requires new energy across the whole government system to make this happen.
There is no magic formula and the next government, like the last one, may well struggle to ensure enough houses are provided. Ministers will fear that the best they can achieve is to “fail better.” But if they meant what they told the electorate during the campaign – that they would do everything possible to provide new homes, including enough social and affordable supply – then there is no excuse for not pushing ahead.
The entire system needs to be coordinated to deliver more housing, in line with the revised National Planning Framework. The implementation of the new Planning Act is part of this, though in some areas concerns of some expert groups are worrying.
The kind of urgency called for by the Housing Commission and its specific recommendations – set to one side in a defensive reaction by the outgoing Government – need to be looked at afresh. No one document, or group, has all the answers, but the commission’s report was a good attempt to tie all the different strands of policy together in a coherent framework. And that has been missing.
Making progress will not be easy and also requires the provision of water and energy to relevant sites, now a key concern. It needs a focus on value for State money and on the processes and approaches needed.
The Government starts with some advantages, too. For now, at least, it has significant resources at its disposal. Housing commencement data suggests there could be a pick-up in completions next year. And, at the start of its term, it can afford to focus on putting the pieces in place for longer-term success. But the crucial first step must be an acceptance that a new approach is needed if housing really is to be the priority.
