There is a need to create a vision for the sustainable future of housing in Ireland.
That’s the view of Paul McDonnell, head of the Property Finance Group at Bank of Ireland, speaking in advance of the Society of Chartered Surveyors Ireland’s Annual Dinner tonight (Thursday 13 February, 2020), of which the bank is main sponsor.
He points out that property finance has always been a core part of the bank’s business. Throughout the recession the bank remained active, continuing to lend into the property market and in 2014 created a €250m fund specifically to support residential and commercial development projects.
“Fundamentally, a sustainable vision for the future is needed to achieve the best outcome for our environment, our growing population, and changing demographic demands”
Since then the fund has grown and Bank of Ireland currently has a €1.5bn fund for development finance with approvals in place to support the delivery of around 9,000 new homes, 2,000 student accommodation beds and 1.8m sq ft of commercial space over the next few years.
A report from stockbrokers Goodbody recently revealed that 21,500 homes were built in Ireland in 2019, up 19pc on the previous year. This was the highest level in a decade and almost five times more than the 4,575 built at the recession’s lowest point in 2013.
Notwithstanding this increase in production, there remains a national housing crisis.
To alleviate this crisis, it is obvious that more new homes need to be built but it will be just as important to build these units in a sustainable way.
What will sustainable housing look like in the next 20 years?
As part of a long term commitment to the market, Bank of Ireland is commissioning a study which will be underpinned by solid independent research into models that could support an Ireland whose population is set to grow by an additional 1m people by 2040. These models should examine various forms of ownership and affordability but take into account density, services and crucially, quality of life.
“We see a need for good research into what sustainability will look like in the market for the next 20 years and beyond,” he told ThinkBusiness. “It boils down to three simple questions: What should we build? Where should we build it? And how it will be funded?”
McDonnell said that the time is now to prepare for the balanced supply of quality housing for individuals and families at all stages of their lives. This includes supporting a professionally-driven private rental market as well as sustainable models of social housing and private ownership.
Building an Ireland for 2040
McDonnell added that any vision for the future of sustainable housing in Ireland will need to take into account not just the availability of supply but, building sustainable communities and different rental and ownership models for different stages in life.
At the heart of this is planning and density, taking into account location, transport, infrastructure, employment, community facilities, amenities and the environment.
“It boils down to what kind of housing should we build, taking into account one-off housing, housing developments, apartments, purpose-built student accommodation, retirement and more. We need to consider all stages of life from the young person renting or co-living for the first time to those getting on the property ladder, providing homes for people who are raising a family and those in retirement who are looking at downsizing or assisted living.
“The next question is where should we be building these new homes? These will be required in our cities, towns, villages and more rurally throughout Ireland. How will these homes relate to transport and people going to and from work and what amenities are there for new communities?
“I think planners have learned a lot of lessons from the previous generation of planning. But if you look at the Irish Government’s paper Project Ireland 2040, it is time to attempt to define and envision a sustainable future for a population that is set to rise by a further 1m people.
“It won’t be all about building apartments for young families in urban centres, that is one aspect. It is about making sure that there are other choices for young families all over the country and also what they will require in 20 years’ time as they move through different stages in life.
“As a bank, we need to ensure that the strategy we have today around funding development is consistent with how we, as a country, will build a sustainable housing sector.”
McDonnell concluded there is a need for a study to envision ownership models that are sustainable and go beyond the housing stock and rental issues of today.
“Our study will take into account models of ownership: how much of it will be privately owned, how much will be managed by a professional rental sector and how much of it will be Government-owned, social and affordable housing, and indeed, how much should be a partnership between Government and commercial developers.
“Fundamentally, a sustainable vision for the future is needed to achieve the best outcome for our environment, our growing population, and changing demographic demands.”
Written by John Kennedy (firstname.lastname@example.org)
Published: 13 February, 2020