Housing and my union dues March 23, 2017Posted by Tomboktu in Economics, Housing.
Today I was very happy to see some of my union dues being put to good use beyond my own personal needs or interests. My union is a supporter of the Nevin Economic Research Institute, and the Institute published its proposals for responding to the housing crisis: the establishment of a new state company to commission or undertake a programme of building, acquiring and renting new homes in Ireland. Tenants would be charged rents that reflect the cost of building (and financing the building) of the new homes.
It is a brilliant proposal, and if implemented would achieve a number of outcomes: most obviously, to provide the additional housing that is so badly needed in Ireland, but also to interfere with the highly distorted market in a constructive way by providing a significant volume of rented accommodation at prices that match to cost of providing it (building costs, maintenance costs, repayments on capital advanced, etc.) and therefore provide an economic lever to shift the price of rental housing across the market downward into more reasonable territory. (I think it is that second aspect of driving down excessive prices, rather than the cost of the initial investment, that is more likely to impede the implementation of the proposal.) Finally, it would shift the underlying values in public policy by treating housing as a social good, a right, and the basis of a home, and not merely a market commodity to be traded in the short term for the maximum possible profit.
I’m very happy that some of my dues contributed to funding that work (however tiny a fraction it may have been).
The 79-page working paper on the proposal is here: http://www.nerinstitute.net/download/pdf/irelands_housing_emergency_time_for_a_game_changer.pdf