An Garda Síochána should consider using their pension fund to set up a co-operative to build houses, according to lecturer in housing and urban issues.
Lorcan Sirr said in the 1950s teachers undertook similar projects in areas of Dublin like Whitehall that were very successful.
“I’m curious when I hear public sector organisation talk about the difficulties facing their members. The gardaí come to mind.”
“All these organisations have pension funds. These could be invested in homes. If the money is there it should be put to good use to benefit their own members.”
Mr Sirr was speaking after the Economic and Social Research Institute (ESRI) published a report on Monday which said the cost of buying a home will rise by at least 20 per cent over the next three years.
However, it said price growth at such a rate would not mean another property bubble was inflating.
The latest report from the State-funded think tank says that if economic growth projections are realised and if housing supply issues are not addressed then prices could rise significantly more between now and 2020.
The study compares house prices in the Republic with prices internationally and looks at price-to-income ratios and price-to-rent ratios before reaching the “unambiguous” conclusion that “the Irish market does not yet display any signs of overheating”.
Mr Sirr said on Monday when the developer was taken out of the equation “they would be saving a fortune.”
He also warned that reducing VAT for builders in a bid to increase supply would not necessarily translate to lower prices for purchasers. “There is no relation between the cost of construction and the sales price.”
“There is a huge profit margin in building houses. If these organisations [such as An Garda] bought a site, contracted a builder and built their own homes it would be much better value.”
The Construction Industry Federation has argued there are fundamental issues facing the supply of new homes, including a lack of finance, procurement issues and planning delays that are preventing the efficient and timely delivery of critical construction projects
Mr Sirr also called for the counting of new homes to be handled by the CSO not the Department of Housing.
He said the existing methodology using ESB connections was inaccurate, he told RTÉ’s Today with Sean O’Rourke show. Houses in ghost estates have been double counted, he said.
Marian Finnegan, chief economist and director of research with Sherry Fitzgerald, agreed and said “we’ve been doing this wrong for some time. The actual through put of completed houses is way less than 10,000 and we need 35,000.”
The chairperson of the Threshold housing association, Aideen Hayden warned a massive bottleneck of supply was building up. “There is an enormous surge waiting to happen with regard to the demand for housing.”
Ms Hayden said the Rent Pressure Zone terms are being breached because of loopholes that need to be closed off. “It is spiralling out of control,” said Ms Hayden.
The ESRI report characterises the Irish market now as one where prices have almost fully recovered from the substantial declines experienced between 2007 and 2013 but says by “international comparisons, Irish prices appear to be quite affordable”.
The report also warns that continuing house price increases “pose certain competitiveness pressures for the economy” and calls on the Government to focus on increasing supply.
Fianna Fáil’s Housing spokesperson Barry Cowen said lack of new homes the core problem and the Government was not addressing the issue as quickly as they should.
He told RTÉ’s News at One that the Help to Buy scheme did not work as it was supposed to and that the Government is not doing enough to assist social housing.
Builders needed to be incentivised, he added and the Government should do more to tackle the 40 per cent of construction costs that they control (including VAT and development levies).
Mr Cowen called for the introduction of a scheme similar to one operated in the UK where State land is given over to housing associations who then bring affordable housing to market.
The ESRI report characterises the Irish market now as one where prices have almost fully recovered from the substantial declines experienced between 2007 and 2013 but says by “international comparisons, Irish prices appear to be quite affordable”.