Procyclical Social Housing and the Crisis of Irish Housing Policy: Marketization, Social Housing, and the Property Boom and Bust

Abstract

This article analyzes the role of social housing in Ireland’s property bubble and its experience of the global financial crisis. The article argues that over recent decades social housing has been transformed from a countercyclical measure which counterbalances the market into a procyclical measure which fuelled Ireland’s housing boom. The reform of social housing financing and acquisition mechanisms has embedded social housing in the boom/bust dynamics of the private housing system. Analyzing the shifting relationship between social and private housing is crucial to understanding the role of housing policy in Ireland’s property bubble as well as the current housing crisis. Despite being caused by problems in the private housing and financial systems, the crisis has had very negative consequences for social housing, thus producing a crisis across the housing system as a whole.

Keywords:

• Social housing
• Ireland
• housing
• policy crisis

Notes

1. In the Irish context, social housing refers primarily to housing provided and managed by local authorities or housing associations. Both local authorities, the main provider of social housing, and housing associations provide housing on the basis of need at very affordable rents, which are linked to tenants’ income.

2. Notably, the other elements of the Irish welfare state did not display similar resilience, as evidenced by the fact that this country did not enjoy the golden age of welfare state expansion that occurred in other Western European countries in the three decades after World War II, and Irish health and social services in particular remained very underdeveloped by the standards of neighboring countries until the 1970s.

3. Although this should not be taken to imply that these arrangements were always unproblematic, and Daly’s (1997) history of Irish central–local government relations reveals regular conflict between the housing ministry and the municipality responsible for Dublin (Ireland’s largest city, where slum housing was most widespread) over borrowing for house building, which reached such high rates that the municipality’s solvency was at times open to question and it regularly failed to attract buyers for its bond issues.