Dublin City Councillors say that they want to expand access to public housing to anyone who wants it, with rents set as a proportion of income.
Since last February, councillors in a cross-party working group have met several times, to thrash out what a new model for public housing for the city should look like and how to make it possible.
Last Wednesday, that working group presented its report to the council’s housing committee.
Public housing should be “high quality sustainable housing for all citizens, regardless of income, that is rented from one’s local authority or its nominees,” says the report.
The idea is to try to provide public housing in a better way than what we have done in the past, says Social Democrats Councillor Mary Callaghan.
“There are a lot of countries in Europe who do it much differently from us,” she says. “So why not look at different ways of doing it and think outside the box.”
The report recommends, among other things, a shift away from the idea of affordable rents tied to the cost of building and financing homes, instead looking towards rents calculated as a percentage of the household’s income.
The council should stop selling off land too says the report – including to owner-occupiers for “affordable purchase” homes.
Central government sets eligibility for social housing. But, for now, those on the working group at a council level are waiting to hear from council officials, who are tasked with running the numbers and feasibility of each suggestion.
Who Gets It?
Public housing should be available to anyone who wants it, says the report.
But, a transitionary period might be needed, so during that time, some public housing should be aimed at middle-income earners, who currently are above the threshold for social housing.
According to the report, a good income cap for a single person would be €50,000, and €75,000 for a couple, which is the current limit for the Rebuilding Ireland Home Loan Scheme.
“The people who don’t qualify for housing supports but don’t earn enough to be able to afford a mortgage,” says Sinn Féin Councillor Daithí Doolan. “They are locked into very precarious, unsustainable, private rental accommodation.”
Callaghan says a lot of households are just €5,000 or €10,000 above the social housing income limits. They could be working around the clock but still can’t save for a deposit because they are paying so much rent, she says.
Crunching the Numbers
St Michael’s Estate in Inchicore, a council-owned site, should be used to pilot this new public housing model, says the council report.
That site is currently ear-marked for a cost-rental scheme but there were fears that the costs have climbed so high that even homes built for cost, on public land, might not be affordable for average earners to rent.
Those rents could be reduced, it says, through rent subsidies for tenants – such as the Housing Assistance Payment – or cross-subsidies, whereby those on higher incomes pay more and offset those on lower incomes.
The report suggests, though, that affordable rents should be set according to the renter’s income rather than the cost of construction, following the same formula as in social housing where rent is set at 15 percent of the income of the primary earner, plus €21 for each additional earner living in the home.
That might not be financially viable to deliver though, says the report — so the working group has asked the council management to do a financial analysis.
“We have adopted the report and said to the council management, now come back to us, with a financial model that delivers it,” says Doolan.
The model is viable, and can be delivered, he says. “We need three things,” he says. “Land, money from the state, and the ability to borrow from the European Investment Bank.”
Interest rates are very low, so now is the time to invest in public housing, he says.
Buying Land, Not Selling It
The report says that the council should stop selling land to private developers or to affordable home purchasers.
“Only in exceptional circumstances and in consultation with local councillors would a [council] site be considered for affordable purchase,” says the report.
Affordable purchase homes are not public housing, says Alison Gilliland, the Labour Councillor who chairs the housing committee.
Three affordable purchase developments already in train will still go ahead, she says. “They are supporting a better income mix, so that is fair enough.”
But after that the council should, in most cases, switch to developing affordable rental housing, she says.
Councillors had also wanted to request that the Department of Housing look at suspending the tenant purchase scheme, which allows social housing tenants to buy their home at a cut-rate.
Not only should the council stop selling its land, it needs to look at buying land for public housings, say Doolan and Callaghan.
The working group is calling on the council to establish a public-housing team to develop the pilot scheme they proposed and to conduct a financial analysis of the proposed model.
The St Michael’s Estate site in Inchicore is currently earmarked for 70 percent cost-rental and 30 percent social, but under this model, that could become 50/50, says Gilliland.
A spokesperson for the council says that management “will assess and evaluate the recommendations in the report and bring that analysis back to the next housing committee meeting”.
If the report is then agreed it will be submitted to the Department of Housing, says the council spokesperson. “Because many of the draft recommendations would require consideration in the context of national housing policy.”
A spokesperson for the Department of Housing says that under Budget 2021, announced 13 October, €35 million has been allocated to a new “Cost Rental Equity Loan Facility”.
This means that Approved Housing Bodies (AHBs) will be able to borrow up to 30 percent of the cost of building the cost-rental homes, which will “kick start” cost-rental housing, they said.
Fiona Dunkin, a housing policy advisor with Clúid Housing, Ireland’s largest AHB, says that they are also working on developing affordable rental schemes.
The costs of each scheme is different but there is a problem with the cost-rental projects in Dublin, in that they may not be affordable, she says.
Subsidies may be required to make them affordable, she says. She would favour a scheme where the rent was set at a fixed proportion of the household’s income.
Another proposal being muted is that the rent would be a proportion of the market rate, she says.
That doesn’t moderate rents across the wider rental sector, though.
Untackled in the report is the detail of how any transition would work, and how to grapple with concerns that – with limited public land and resources – those who are in greatest housing need wouldn’t necessarily be first in line for all projects.
Even if a longer-term view is that it would benefit those needing affordable rents across the rental sector, and create a more sustainable public housing system for the future.
Dunkin says that affordable rental schemes should be on top of plans for social housing and shouldn’t ever be built instead of social homes.
Gilliland, the Labour councillor, says that it is important that households who are newly eligible don’t leapfrog those who have been waiting for social housing for years. “That is the balance of entitlement that we are trying to work out.”
Rather than doing cost-rental in some places, and social housing in others, schemes should be mixed, Gilliland says.
This public housing model is a way of bringing in social mix without selling off public land, she says.
Doolan of Sinn Féin says that it shouldn’t be a choice between one or the other cohort. “At the moment nobody’s housing needs are being met.”