We need more homes – especially with a rising population. But the private sector is not delivering.
For over a decade, governments have repeated the line ‘it is a supply issue’ whenever they are asked about astronomical house prices and rents.
However, evidence has now emerged that the Irish construction sector will never be able to satisfy demand.
There are two big construction companies. Cairn and Glenveagh, have built 14,000 homes between them, and about 15% of housing starts in the five years since 2019. Their main concern is making a profit. Last year Glenveagh made €63 million and Cairn made €103 million.
They acquire large landbanks and often wait until planning permission helps to push up the value of the land.
Besides the big two, the construction industry is often based on small building companies.
These cannot build on a mass scale that would be big enough to reduce house prices.
A state construction company, however, could build on a mass scale. It could construct tens of thousands of homes on public land. It could build much cheaper homes because its primary motive is not profit but public need.