In late January, the Irish Times reported that the Fine Gael Minister for Transport Paschal Donohoe was pressing ahead with the privatisation of a number of Dublin Bus and Bus Éireann routes. This is a proposal that has been doing the rounds for years. It has been part of at least three government programmes since 2007. Having failed to convince the drivers’ unions of his plan, Donohoe is now putting 23 Dublin Bus routes and 5 Bus Éireann routes out to private tender. From a geographic perspective, this plan is of interest because part of the proposal is that no privatised route will “terminate in the city centre and are primarily orbital routes, or services carrying commuters from rail stations or large shopping centres to suburbs”. Why is this? What is the rationale for doing it this way? It will not take long but this is part of a plan for wholesale privatisation, working inwards from the city’s periphery to the centre.

In this post, we want to briefly examine the geography of the Dublin Bus routes considered for privatisation. We examine the demographics of these ‘orbital’ areas. It is an attempt to understand the politics of this transport policy and to see if there is a relationship between these routes and specific socio-demographic indictors. We use CSO/AIRO maps at small area and electoral division levels to examine what public is served by public transport. These districts are generalised census units which aggregate a large amount of information in a single measure. All of the routes proposed for private tender serve suburban locations, albeit very densely populated ones. In the absence of route-specific passenger load data (a vital part of commoditisation), it can be argued that some of the routes proposed for privatisation have been in decline since the early part of this decade. For example, routes 63 and 75 serve many of south Dublin’s affluent areas where travel by private car is more usual. The map below shows a part of Dublin’s suburbs alongside the percentages of Professional Workers in each area.

map 1The map shows how the routes proposed for private tender travel through areas of relative affluence in terms of social class. A map for private car ownership (a basic proxy for affluence) yields broadly similar results. Routes 63 and 75 travel through this affluent and car dependent part of south Dublin.

Map 2How will private tenders operate in areas of higher car dependency and among those in higher social class groups? If the imperative is to profit and not service, what attracts a private operator to these routes? Looking at Blanchardstown, a western suburb, a number of routes are proposed for privatisation. The map below shows the percentage of an area’s population in the skilled manual social class. Areas that are soon to have privatised bus services have up to 20% of their population in this class, arguably those most in need of mass transport.

Map 3Finally, and in the same area, the areas with many households with access to two cars is relatively higher in the south when compared to the area north of the main road (indicated by routes of the 270 and 17A). Using the All Island Deprivation Index data for the north city area, we can see that the 17A and 220 routes serve areas of high disadvantage but that these are served by other bus routes. In Blanchardstown, the 236 and 200 routes proposed for privatisation serve areas of relatively high disadvantage.

Map 4While the routes proposed are said to be ‘orbital’ they serve tens of thousands of people travelling to and from work, retail and education every day. To whom they are orbital is only a consideration to a network and its planners that makes the city centre the terminus for most routes.

What is being achieved by the proposal of these routes to be sent for private tender? At an initial glance, it seems that there will be differential effects across the city. In the southern suburbs, where two car ownership is higher than other parts of the city, a less frequent privatised bus service will matter relatively little. In areas where the bus is the only form of frequent transport, operating routes on the basis of something other than profit is a social good. It forms part of a social wage. Along with the recent contraction of schedules and the number of vehicles, certain areas of Dublin are now more dependent on this service when compared with others.

A privatised route will have to generate income and to do so can only increase fares and / or lower wages. We have seen this for refuse collection since 2001. Taking the city as a whole, the private tendering of these ‘orbital’ routes is a testing ground for more extensive privatisation on other, more lucrative, routes in the years to come.  A private operator is not going to want to compete on one route but on many across the entire network. If a route is operated by a profit-driven company, the license to service the route will need to stipulate the regularity of the service. A route that runs at peak times only and does not operate outside of this peak defies categorisation as a social good. Ours fears for privatisation is that there will be a focus on running a bus only on that exact slot in the schedule that will be busy. There is little assessment of the route within the system as a whole. Having operated a route for perhaps two years, private operators will be back at the minister’s office door arguing for access to these more lucrative routes.

Eoin O’Mahony, Assistant Lecturer SPD/DCU & Omar Sarhan, GIS and data enthusiast

BeyondPebbleIn May 2011, I posted a review of the book Redrawing Dublin by Paul Kearns and Motti Ruimy (Gandon Editions, 2010). In it I critiqued some of its arguments and its wider approach to urban regeneration. In recent weeks, the authors of Redrawing Dublin have published a follow-on book – Beyond Pebbledash  (Gandon Editions, 2014). The book offers a re-working of some of the arguments contained in Redrawing Dublin and has been published to parallel an artistic installation involving the recreation of a façade of a pebbledash house in Collins Barracks (see more here). Given this publication coincides with some of the key challenges of the present time and that in the introduction to the new book the authors have also made reference to my original critique of Redrawing Dublin, below I have taken the opportunity to engage in some of the arguments it presents. This is particularly focused upon the newer parts of the text.

As with the timing of Redrawing Dublin, this is an apt time to question the future of the built environment in Ireland, albeit for what are now largely different reasons to 2010. The built environment encompasses and is bound up with so many of the challenges facing Irish society that it becomes difficult to untangle the various elements. That the Beyond Pebbledash project seeks to engage with these challenges – not least through engagement with local schools – and the wider challenge of urban discourse should be commended. Moreover, that the project challenges the dominance of the three-bed semi-detached house and its relationship to market-led approaches within debates about housing should also be welcomed. However, I contend that from the perspective of creating a socially balanced and sustainable city, the central arguments contained within Beyond Pebbledash offer a questionable policy approach. Although setting out to be somewhat playful in its approach, the driving force, or central premise, of this book is to promote the city for middle-income and upper-income family living. While I don’t take issue with this in and of itself, I argue that the manner and extent to which it is being pushed is in danger of exacerbating the very problems the authors seek to challenge.

In setting out this critique, it is acknowledged that Dublin, as with other urban centres in Ireland, faces considerable challenges. The following is therefore not in defence of urban sprawl or, indeed, opposed to the densification of the city. There is a significant amount of merit to a dense city core, including walkability, the potential for cycling infrastructure etc. That increased apartment size would improve quality of life is also something worth taking very seriously. However, it is one thing to promote high-density living, but to fetishize it as being representative of the virtues of middle- and higher-earner lifestyles enters dangerous territory. Instead, as briefly outlined at the end of this review, we need to look very carefully at the connection between factors of governance, justice and their relationship to the city in addressing the future of the built environment in Dublin and other Irish towns and cities.

As argued above, the central premise of Beyond Pebbledash is to promote the city for middle- and higher-income earners. This is used in conjunction with high-density living as a means of conveying what the authors perceive as a more livable city. This is most strongly articulated through the representation of the future of the Georgian core. Here, the authors argue that policy should promote Georgian Dublin as a living quarter for middle-income and, more particularly, higher-income families. This, they argue would help to promote social-mix in the city through a form of trickle-down effect: “Attracting higher-income families back to the city would assist in consolidating, often fragile, residential living elsewhere in the city centre and inner city. Dublin’s Georgian red-bricks along Upper Mount Street and other streets may, in time, become the fashionable equivalent of the New York brownstones” (2014, p.158). That this is fostered as being the end-state of Dublin is severely questionable policy-making. That one particular social group, who already have a significant advantage in the selection of housing, would become the central feature of policy making represents a severely imbalanced approach to urban regeneration – not the social mixing they seem to believe it will result in. Furthermore, that this is being promoted at a time where housing is becoming increasingly unaffordable for many raises further doubts about its merits as a policy objective. If anything, placing such debates in the context of the recent social trajectory of New York brownstones highlights how such approaches result in an increasingly unequal city, something that the authors of Beyond Pebbledash state themselves to be opposed to.

In pursuing its arguments, Beyond Pebbledash is in conversation with a number of urban discourses, all of which remain somewhat invisible or implicit. As an example, their perspectives of debates about anti-social behavior and gentrification are summarized as follows: “But the very concept of the desirability of living in an inner-city neighbourhood can often provoke illogical thinking. It’s as if certain areas of the city can never really become desirable places to live in; perhaps worse, they somehow shouldn’t. To suggest otherwise is to risk ‘gentrification’. Residential desirability for some is suggestive of something vacuous, unreal, and denuded of the political earthliness of regeneration.” (Kearns and Ruimy, 2014, p.135). Continuing, and to give emphasis to their argument, the authors refer to this supposed perspective as portraying a “profound bigotry of place.” Here, the authors make it explicit that there is a desire amongst an unidentified group to accept the city as it is.

This, however, is a false-representation of debates about urban regeneration in Dublin and other cities. To take the example of gentrification, it should be made clear that it is not that critical urban discourse somehow wants poor quality urbanism or a city plagued by anti-social behavior. Instead, amongst other factors, critical urban discourse argues that attracting the middle- and upper-classes back to the city (a dominant urban ideology of the last three decades or so) does not actually solve complex social issues. Instead, Kearns and Ruimy aim to depoliticize highly charged forms of urban change and perceive urban transformation as a simple exercise of getting on with so-called difficult decisions. This perspective ignores how bound up these issues are with social class and power. To ignore or dismiss this is not just a matter of dismissing academic arguments, but is in danger of ignoring how the city is shaped, for whom the city is for and who the city should be for in the future. These debates are also not something isolated to one particular section of enquiry, but, as is emphasized by the so-called ‘poor door‘ discussions in the UK lately, are becoming central to debates about the nature of current approaches to urban transformation.

There is a pressing need for policy discourses about city life to challenge the notion that cities can be ‘saved’ by making them more attractive to middle-income and higher-income people, and not to continue reproduce such perspectives. This is a somewhat nuanced debate, but solutions to the tangled-web of urban change – including the social problems discussed in Beyond Pebbledash – need to be led through structural approaches (both in urban and suburban contexts), some of which might be contradictory. In setting out what we as citizens want Dublin to be, and thinking through what might make it better, there is a need to think about for whom it is better for. This would bring us to questions of, for example, justice, land ownership, affordable rents/ownership, and wider questions of governance (including a significant increase in integrated decision-making within Dublin’s four local authorities so to promote inclusive decision-making). Such approaches would not preclude social mix, but would be aware of the importance of looking at social context when implementing such policies. When taken in combination, such approaches must also be seen in the context of wealth redistribution and its impact upon reproducing urban society.

There is already evidence that policy is seeking to look at alternative models of urban transformation, and possible departures in this regard have recently been outlined by Dublin City Council. There is no reason that these approaches could not include the re-use and densification of development parcels in the city centre. However, in so doing, it must seek to achieve a balanced approach and not an approach that is based on the philosophy that the attraction of middle-income and high-income residents will solve its issues. While Kearns and Ruimy perceive their approach as leading to a balanced social structure, evidence from cities such as London would point to the opposite. Indeed, unless policy seeks alternatives to this discourse, we may well be looking at a greater level of social polarization in the coming decades. Given its levels of vacancy, Dublin, of all cities in Europe, has a chance to take a different approach. The answers to this involve looking at alternative structural models which question the roots of challenging social issues such as inequality and promote the means to alter them.

Philip Lawton

The ESRI published a report this morning concerning housing supply projections up to 2021. Along with the Housing Agency housing supply report published in April 2014 and the CSO regional population projections published in December 2013, it suggests the need to create substantial new supply in the Dublin region and the other principal cities — no surprise to anyone who has been trying to buy in the region or is on the social housing waiting list.

To summarise: housing need projections

The ESRI report details projected housing supply need until 2021. It argues that there will be an increase in household demand of 180,000 units, but because of oversupply in many parts of the country only 90,000 new units will need to be built, some 12,500 per year. 56,000 (60%) of these need to be in Dublin, 8000 per year. 26% more will need to be in the Dublin commuter counties of Meath, Kildare, Louth and Wicklow. Overall, 86% of all new build will need to be in the Greater Dublin region. However, in many counties, the report suggests that new supply will not be needed because of existing oversupply. Indeed, Donegal, Kerry, Mayo, Tipperary, and all the Upper Shannon counties of Leitrim, Sligo, Cavan, Roscommon and Longford are projected to still have oversupply in 2021.

The Housing Agency report analyzed housing need for 272 towns and cities across the country for the period 2014-18. It argued that there was a need for 80,000 new units, or 16,000 per annum. 37,500 units (47%) would need to be built in Dublin, or 7,500 units per annum.

Both reports use a fairly standard housing projection model using housing stock, population projections, household size, vacancy and obsolescence.

The CSO regional population projections gave a mid-term estimate of population numbers in 2031 using two scenarios. The projections predicted that Dublin population would grow by between 96,000 and 286,000, and the Mid-East region by 77,000 to 144,000. In the upper scenario the Greater Dublin region would therefore see its population grow by over 400,000. In contrast, in the lower scenario, the Border region population would increase by just 18,000 and the West by 17,000. Although these figures relate to population, they will clearly need to be housed and these figures suggest the need for substantially more housing stock over the next 17 years.

There is pretty good harmonisation between the ESRI and Housing Agency reports, both suggesting that c.8000 houses need to be built in Dublin per annum to meet demand.  The overall national required rate of between 12,500-16,000 per annum is actually quite modest.  Typically over the past forty five years new build has been 20-30,000 per annum, rising to 40,000+ post 1998.  12,500 is in fact lower that the lowest build rate going back to when DECLG records start in 1970.  In other words, this is by no means an excessive ambition.

So why do we need supply in Dublin given the crash, oversupply, emigration, etc?

In short, the oversupply of the boom for houses in Dublin as a whole was relatively small, and there wasn’t one in South Dublin. There was, however, a reasonably large overhang of apartments. However, since 2008 the three main drivers of housing demand have been growing: natural increase, in-migration to the city, and household fragmentation. These have soaked up the oversupply. On the other side of the equation housing supply has been minimal. In 2013 only 1360 units were built in the four Dublin local authorities (only 8301 nationwide, over half of which were one-offs and generally not for sale on the open market). In short, over the past seven years we’ve moved from having excess supply to excess demand in Dublin and some other urban locations.

So if there is demand why isn’t there supply?

Good question. Housing supply is shaped by a number of factors: demand, available zoned land, planning permission, building costs (materials, labour), regulatory conditions/costs (taxes, levies, fees, etc), finance (for developers and consumers), and ability to make a profit.

In theory a lot of the right criteria for creating supply exist. There is an excess of demand. There are 6400 acres of zoned serviced land available in the four Dublin authorities for 132,000 units. There are a lot of outstanding planning permissions still in effect and LAs want to give permission for developments that meet development plan/zoning criteria. Material and labour costs of significantly lower than the boom time.

And yet, supply does not seem to be coming on stream and there seem to be blockages across the board. With respect to land, it may be the case that owners are not bringing it to development because they bought it in the boom and can’t afford to develop at present house prices. With respect to planning, it may be that developers are seeking permissions that contravene development plans or are trying to alter existing permissions. The property industry also say that the system needs streamlining and simplifying. They also make the case that there are too many taxes and disincentives attached to building such as development levies, VAT, stamp duty, building reg costs, etc that amount to a sizable proportion of any sale price. Finance is a critical issue. Developers need a sizable amount of upfront cash to secure development loans, yet many are bust from the boom or do not have such reserves.

So what are we to do?

The government needs to quickly evaluate each of the potential blockages and work out solutions that are fair and do not undermine good planning and build quality or excessively boost profit at the state’s expense. By quickly I mean weeks, not months and certainly not years. The longer that supply is constrained the more demand there will be on existing stock and house prices will continue to rise. The Construction 2020 strategy is full of task forces, review groups, consultation exercises and very short on actual policy and implementation. We need supply coming on stream as quickly as possible in the Dublin region and some other urban locales (though certainly not in many parts of the country). Construction 2020 thus needs to be fast tracked. After all, 2020 is meant to be an end date, not the date ground is broken.

Rob Kitchin

There have been a few headlines recently about some families losing their rental accommodation as rents increase and becoming homeless (see these stories: one, two, three, four; also listen to this radio piece on RTE). It is reported that homelessness is on the rise and a homeless crisis is emerging in Dublin in particular. According to Dr Dáithí Downey, Deputy Director of Dublin Region Homeless Executive (DRHE), paraphrased in Saturday’s Irish Times, the homeless crisis is ‘bloody awful and getting worse’, with Jan O’Sullivan TD, the Minister for Housing, admitting that there is ‘no doubt’ that the issue of homelessness among families is a growing issue.

So what is the situation in Dublin at present? 

According to DRHE, in 2013 a total of 4,613 unique individual adults used homeless services in Dublin (across all funded NGO’s and statutory services – a full report for 2013 is available from DRHE upon request).  The demand has strengthened and changed in character since Autumn 2013 with more families with child dependents experiencing homelessness.  The Simon Community report that in 2012, there was an increase of 24 per cent in those using their services, to over 5,000 individuals and families.

During the week beginning April 28th 2014, the DRHE confirmed there were 184 households with dependent children accommodated in 21 commercial hotels across the Dublin region in lieu of provision of more suitable emergency accommodation for families due to a lack of capacity in usual emergency accommodation.  The majority of these families were welfare dependent private tenants.  The decision to use hotels is seen as a last resort taken in order to prevent any increase in rough sleeping in Dublin, especially among adults with dependent children.

Dublin’s homeless services secured an exit to tenancies and independent living for 793 persons in 2013. This is down by 10 per cent on the previous year’s 879 exits, and a similar downward trend exists for 2014.

So what is causing the rise in homelessness, especially amongst families in Dublin? 

Here’s what I think is happening.

1) From 2012 onwards there has been an increasing shortage of supply of property for purchase and rent in Dublin city due to in-migration and lack of construction.

2) The increasing demand for tenancies has led in turn to a rise in rent due to demand outstripping supply.

3) The rise in rent has been bolstered by new institutional investor owners, and by buy-to-let landlords facing a move from forbearance to foreclosure, seeking a certain yield by squeezing tenants – moving rents up at a rate significantly above inflation (25% to 30% increases in some cases)

4) Families who are income insecure – low wage, uncertain hours, flexible working, dependent on welfare – cannot afford the increase in rent, and rent supplement is not sufficient to cover the gap. They are being priced out of their homes in favour of those who can afford the new rental price.  Such pressure is not aided by tenants often not knowing their full rights or seeking redress through the Private Residential Tenancies Board.

5) These families find it difficult to find alternative private rented accommodation due to rent inflation across the rental sector and landlord preferences for tenants not reliant on rent supplement and discrimination against such tenants. This is also reducing exit routes from homelessness.

6) There are nearly 90,000 households on the social housing waiting list and it is therefore almost impossible to parachute newly homeless families immediately into social housing.  Consequently, those pushed out of the private rental sector end up in emergency homeless accommodation.

7) This process of creating new homeless families is likely to continue as rents rise given the present reliance on private rental sector for new social housing provision.  Moreover, it might be bolstered if repossessions increase as expected from this summer onwards, with former homeowners becoming homeless.

So what is the solution?

DRHE recognise that the use of hotels is both an inadequate and inappropriate way to meet the housing needs of homeless families and can only be considered a short-term respite from being shelter-less and also that it is financial unsustainable. They are projecting a final year cost of over €4.5m for the use of hotels in 2014 if no alternatives are brought forward. So what is required?

First, the state needs to invest in creating new social housing – both refurbishing empty, unoccupied and derelict housing stock in the city and creating new suitable stock in control of the local authorities not private landlords.  The Dublin local authorities have already submitted plans to government for the acquisition and refurbishment of stock for homeless households that will requires a projected capital budget of at least €10.5m to realise.

Second, rent control needs to be introduced that limits unregulated rent increases that are far in excess of inflation.  This needs to be accompanied by an increase in tenant rights that offers them enhanced protections as is common in continental Europe.

Third, there needs to be an additional investment into homeless services to provides the resources that will enable them to more adequately deal with the crisis.  Wishing it will to go away will not work.

Rob Kitchin

'Disneyfication'? Sources close to the plan have denied any connection between Frackaballooning and the film 'Up'

‘Disneyfication’? Sources close to the plan have denied any connection between Frackaballooning and the film ‘Up’

Plans were today unveiled for the sale of a large amount of Dublin. This includes the discussed sale of Foxrock to Los Angeles, Rathmines and Phibsborough to London, and the Liberties to New York. The proposal, which entails air-lifting large swathes of land, is being made possible by methods similar to fracking in combination with hot-air balloon technology. Many in the industry are referring to the method as ‘Frackaballooning’.

A spokesperson for NEGEQT-RealEstate stated that the appeal of this approach was because of the perception internationally of good value in the Dublin market at present and also cited a number of other positives to the plan: “First and foremost, it allows us to get building again and presents a very real opportunity to open up more land for much-needed market-driven housing, particularly in Dublin. In fact, with this new technology, we can now sell the city over and over again. At the moment everyone wants three bedroom houses so we will provide that. In the future those demands might change, so we will just repeat the process but provide something else. Finally, it ensures that we reach our emigration quota each year, while allowing people to remain in their homes and maintain a direct connection to Irish soil. It really is very exciting and very sustainable too.”

Given their respective prime locations, Foxrock and Sutton are perhaps two of the most noteworthy of the sites included in the plan. One well-known journalist commented that it was a logical step: “with their sale to Los Angeles, those living in Foxrock and Sutton will still have lots of open space and a similar commute time, but will get a lot more sun.” The auctions are being held by a firm new to the Irish market, called FLAIR, who are specialists in Frackaballooning-driven sales. One representative commented on how the bidding at their first auction had been frantic: “It has been great really. Welwyn Garden City and Letchworth were engaged in a bidding war to buy Mount Merrion, only to be gazumped by a phone-bid from Ebbsfleet.” But word is that the level of interest in the technique reaches far beyond the neighbourhood/village scale. It is believed that a number of FRITS (Frackaballooning Investment Trusts) are interested in entering the Irish market in the coming months. Some sources believe that within five years Dublin could be in the top ten global destinations for Frackaballooning. All indications show that this will have a trickle-down effect and allow the gradual sale of most of the country: ‘Well we are starting in Dublin because that is where there is most demand, but I could definitely envisage the sale of Eyre Square as a very real possibility in the future’.

Perhaps the most exciting part of the initiative is the sale of the majority of Georgian Dublin. This is seen as a win-win for both Chaing Mai, who get a new theme-park/film-set and for Dublin to correct the wrongs of its Georgian ancestors. A representative of the Mock-Georgian Appreciation Group, who have single-handedly championed the cause of late 20th Century faux-Georgian architecture for nearly four decades, commented: “really, the wealthy elite of the 17th and 18th centuries didn’t have the wealthy of today in mind. Therefore, the sale of Georgian Dublin, and its replacement with fake-Georgiana, presents the possibility to right their wrongs in terms of both the social environment and the physical context. None of the wealthy in Dublin want to live in Georgian Dublin, so they must really dislike Georgian buildings. We must assume that they prefer faux-Georgian architecture.” The social goals are being promoted through the incorporation of smart technology, which sees a new force-field placed around the entirety of Georgian Dublin so as to preserve it for the wealthy and well-to-do for eternity.

Meanwhile, the newly laid out Faux-Georgian Mile will seek to reflect the dignity and grandeur of the planned ESB replacement, which, based on a recent competition, is to be a relocated Fitzwilliam Hall. The gap left by the removal of Fitzwilliam Hall from its original location will be a replica of the current ESB headquarters building, albeit shrunk to fit the site. As a means of reflecting the inter-subjectivity of the two buildings, they will swap facades for a period of two hours per day at rush-hour. The Faux-Georgian Mile plan has, however, not been without its detractors. A small group have already demanded the reconstruction of the ESB Headquarters according to the original 1964 specifications, while another group have demanded the preservation of the original, including the removal of the boom-time pink paint. There have also been rumours of a student sit-in, but according to a number of sources there was too much wrangling between those desiring retention of the original and those in favour of a reproduction.

The creation of more vacant space also creates the potential for a strong cultural component. One well-known cultural commentator stated that as part of the plan each area of Dublin that is to be sold off will be recreated on a scale cardboard cut-out model and placed at the centre of a new pop-up park that is to be located on the former site of Kilmainham Hospital, which is being sold to Canada. This is so as to promote discussion about the relationship between Frackaballooning and society.

Aside from the modernist heritage enthusiasts, Frackaballooning has only had a few objections, most of it from ‘activists’. But, as one commentator stated: “We don’t have time for these objections. We have had a thorough public engagement process with those in the industry and others in favour of the process. We can’t allow a few nay-sayers stop progress. We must allow the market to plan our future and this is the most advanced way of making that possible”.

Whatever the detractors say, there is no doubting the ambition and bold vision of the approach. This is exactly the sort of blue-sky thinking that Dublin and the rest of the country needs. After all, hot-air and the sale of land are the twin pillars of sustainable planning.

A. P. Rilfirst

New Paper: ‘Urban Governance and the ‘European City’: Ideals and Realities in Dublin Ireland’ by Philip Lawton and Michael Punch published in the International Journal of Urban and Regional Research. Available here (If you cannot access please email philip.lawton (at) maastrichtuniversity.nl)

Absract:

Throughout recent decades, a significant amount of attention has been given to the notion of the ‘European city’ within policy formation and academic enquiry. From one perspective, the ideal of the ‘European city’ is presented as a densely developed urban area with a focus on quality public transport and a more balanced social structure. More recently, however, the particular elements of the ‘European city’ associated with pedestrianized public space, urban design and image-making strategies have become central features of entrepreneurial urban policies throughout Europe. This article undertakes an examination of the notion of the ‘European city’ in urban change in Dublin since the 1990s. Specifically, the article illustrates the degree to which a wholly positive spin on the urban design and image-making elements of the ‘European city’ in Dublin has served as a thin veil for the desired transformation of Dublin according to neoliberal principles.

This open invite event might be of interest to Ireland After NAMA readers in the Dublin area.

CITY LIMITS – Inventive Uses for Urban Spaces

18.00 -20.00pm Thursday February 13th 2014

Wood Quay Venue, Dublin City Council Civic Offices, Dublin 8.

Over 600 prime sites and a wealth of historic buildings within our nation’s capital are currently vacant or disused.

These neglected places undermine Dublin’s competitiveness and quality of life; becoming hotbeds of anti-social behaviour, detracting from the city’s aesthetic, and artificially inflating the cost of housing. With public and political pressure to use mounting, a government taskforce has been charged with examining the introduction of a levy on vacant lands, intended to prompt action from site owners. As these spaces come in to circulation once more, the challenge becomes how to match the best ideas in urban development with the most suitable spaces.

The Lord Mayor of Dublin Oisín Quinn will open an evening of discussion on potential solutions for vacant city spaces “City Limits – Inventive Uses for Urban Spaces” at Wood Quay Venue at 18.00 on Thursday February 13th.

Initiatives to be discussed on the night will  include the proposed vacant sites levy, DCC Arts Office creative spaces programme,  Allotment Homes, Dublin House, Granby Park, the Rediscovery Centre, Chamber Weaver Park and Makers & Brothers pop up shops. If you have a project you’d like to discuss or are just interested in this area, please come along.

This free, open-invitation event will be followed by networking and drinks. Hope to see you there.

 

On Sunday I blogged on what is happening with respect to housing in Ireland, including a breakdown of some key stats, and also did an interview on This Week on RTE Radio 1.  In response, I got the following question via twitter: “So is it a bubble in Dublin then? And will govt. plans to build more houses help normalise?”  These are not really questions that can be answered with 140 characters.  I’ll take each question in turn.

Is a new bubble forming in Dublin?

Having fallen by 57.4% from the peak in 2007 (houses 56%, apartments 63.3%), since August 2012 prices in the capital bumped along the bottom for a few months then started to rise.  Between Nov 2012 and Nov 2013 prices grew by 13.1% to be 49.2% lower than the peak.  It is clear that property prices in Dublin are rising steadily at present (see CSO data and AIRO interactive graph).

Housing bubbles generally form when there is an excess of demand, credit and confidence in prices.  This is not the case in Dublin at present, with the rise in prices being principally driven by two related forces.  First, both residential buyers and investors are seeking to enter the market at its bottom; this way they minimize their cost, maximize any growth in equity, and for investors gain rental yield.  Second, they are competing for a small number of available properties leading to bidding scuffles.  Unlike a normal bubble when there is a large number of property transactions and mortgage draw downs, transactions and draw down in Dublin are presently at 40 year historic lows.  Slowing properties coming to the market are very high levels of negative equity (c. 50% of all properties with a mortgage) and low levels of new build (less than 10% the number built in 2006, and over 50% are one-offs that are not coming to the market).  Ergo, prices rise as demand outstrips supply.

Does this constitute a new house price bubble?  Not in the classical sense and it is only a bubble if prices rise in excess of what one might expect given the wider economy (and given they are still almost 50% less than their peak at best we’re only at the start of a potential bubble).

Will building more houses help normalise any bubble effect/slow house price rises to maintain affordability?

One proffered solution to tempering rising prices caused by a supply shortage is to increase the level of stock.  New supply might come from six sources:

  • new build by the private market
  • new social housing provision through government investment
  • defaulting properties due to mortgage arrears
  • second-hand properties coming onto the market
  • new areas becoming active as market activity spreads
  • completion of unfinished developments

With respect to new supply by private developers and government.  Whilst there is sufficient land zoned in the four Dublin local authorities (2,575 hectares/6400 acres for 132,166 units) and there are still a large number of outstanding planning permissions, the big issue is development capital and perhaps re-jigging planning permissions to cater for high density housing in some cases rather than mostly apartments.  The same issue applies to the government who have little money to invest in capital expenditure programmes, which they have significantly reduced over the past few years.  In both cases, even if development capital was sourced, it would be 12-24 months before new supply was available to the market/social housing waiting list.  As a consequence, new supply from these sources will be limited throughout 2014.

There are significant levels of mortgage arrears nationally (we don’t have figures for Dublin alone).  With respect to principal residential dwellings 141,520 (18.4%) of all mortgages are in arrears and of those 99,189 (12.9%) are more than 90 days behind in payments.  The situation is worse for the buy-to-let sector where 40,426 (27.4%) are in arrears, where 31,227 (21.2%) are more than 90 days in arrears.  Whilst repossessions have so far been small, it is expected that they will grow over the next couple of years.  This will increase housing stock available to the market.  However, their present occupants would still require accommodation having knock-on effects with respect to the social housing waiting list and the private rental market.

As house prices rise and household emerge from negative equity those wishing to trade-up or down, or to move to a new area, are more likely to place their property on the market.  This would create some supply, but may not lead to prices levelling off.  This is for two reasons.  First, part of the reason that house prices fell so much is that the stock on the market was not representative of all stock, but rather distressed assets that owners felt compelled to sell in a falling market, with owners who could afford to avoid selling staying out of the market (typically those who are better off).  Second, the majority of trading that has taken place has mainly been related to lower priced property rather than higher-end stock.  We might therefore expect prices to rise a little simply as function of the nature of stock coming to the market changing, with better stock demanding higher prices and higher value properties starting to be traded more frequently.  This effect would probably be little affected by more supply.

We lack detailed data concerning market activity in Dublin, but industry sources are suggesting that it is most prevalent in the city core and South Dublin.  As competition for property grows in these areas it is likely that other parts of the city will become more active.  The Dublin housing market stretches far beyond the M50 to the outer suburbs and commuting belt.  These areas still have locales with some oversupply.  Moreover, the completion of some unfinished developments would also add some new supply (though the number of such developments in and around Dublin is quite small).  Both the activation of other parts of the Dublin market and the completion of unfinished developments will re-distribute some demand and work to counter supply driven price rises.  Nevertheless, given the desirability of central and South Dublin and limited new supply in those areas in the very short term, one could reasonably expect rising prices to continue in the city core and South Dublin in the immediate short-term.

Two factors that might disrupt this scenario is a tailing off of demand and limited access to credit.  A phenomena that occurs after some house price crashes is a dead cat bounce wherein prices rise quite quickly from the bottom, but then slow and fall again before finding an equilibrium or rising again (this happened in London following the crash at the end of the 1980s).  The reason for a dead cat bounce is that those who have been waiting for the right time to enter the market (both residential buyers and investors) have done so and market demand drops leading to less competition for property, or supply has risen to meet demand.  Given the level of cash sales at present (c.50%), it is possible to envisage such purchases drying up and the market returning to a more balanced status where mortgage-backed sales predominate, thus removing a significant source of competition-driven pricing.  As such, a dead cat bounce could occur in the case of Dublin.

Moreover, access to credit at present is limited.  In the first three quarters of 2013 only 8,711 mortgages nationwide were drawn down.  Caution on behalf of lenders will limit the number of mortgages issued and the value of such mortgages, thus restricting credit-fuelled speculation and associated price rises.

With respect to the mid-to-long term it seems likely that there will be a continued rise in demand that may create supply issues in the Greater Dublin region.  The new revised CSO regional population projections 2016-2031 predict: “The Greater Dublin Area will see its population increase by just over 400,000 by 2031 if internal migration patterns return to the traditional pattern last observed in the mid-1990s.  … The population of Dublin is projected to increase by between 96,000 and 286,000 depending on the internal migration pattern used, while the population of the Mid-East is set to increase by between 78,000 and 144,000.”  These figures are based on projected national increase and internal and external migration and seem reasonable given the dominant economic position of Dublin in the Irish economy.  In addition, household fragmentation will also be a source of demand.  The extent to which such population growth/household fragmentation will affect property prices is dependent on the extent to which housing supply meets demand as and when it is required.

In summary

In the short term there are potentially different scenarios as to what might happen with house prices in Dublin — they might rise steadily, rise and then level off, or suffer a dead cat bounce.  Or a two-speed market might emerge in the Dublin region, with a division in market activity and pricing patterns between the city core/South Dublin and the rest of the city.  Which scenario plays out is dependent on a range of factors that shape supply and demand and how they evolve.  As I noted on Sunday, the market is far from normal at present and in need of a lot of correctives that could alter how the market behaves, and other factors such as the wider macro-economic context could re-cast how the market evolves.  What we really need right now is some decent modelling using detailed housing, demographic and economic data of potential housing demand and supply for the Dublin region and what we might expect to happen to prices under different scenarios.  We also need similar models for the rest of the country, which has a very different set of issues.  Perhaps the government might commission such work?

Rob Kitchin

There’s been an awful lot of rhetoric recently that the housing market is picking up in Dublin and that trading is brisk relative to what it was a couple of years ago.  Most of that rhetoric is coming from the property sector backed up with ancedotal evidence.  The question is whether this is reflected in the hard data of the house price register? Here is a graph of the number of housing unit sales per month since January 2010 for Dublin.

house price sales 2010 2013

What the data shows is that housing unit sales are relatively consistent over the past three and a half years, except for a brief surge at the end of 2012, with December 2012 seeming to be anomaly (probably based around the ending of mortgage interest relief).  The first six months of 2013 are very similar in pattern to 2010.  In fact, in the first six months of 2013 only 328 more units have been sold than the first six months of 2010.  The data does not suggest then that there has been a bounce back in market activity to any significant degree.  What it shows instead is a relatively steady turnover of property.  Market activity in terms of increased viewings on properties, but not in sales, may well reflect a relatively restricted pool of some kinds of properties (family homes; which the property sector is saying is the case).

In general terms, the sales figures reveals that the market is still a very pale shadow of the height of the boom.  The Dublin housing market consists of 527,665 units (in 4 Dublin LAs according to Census 2011).  Normal market turnover would be 5-7% units (higher in a boom), meaning that we could realistically expect in a normally functioning market 2200-3100 sales per month.   So far in 2013 the average monthly sales is 593 (1.3% turnover).

The Dublin market may be stabilising at the bottom of the bust in terms of price falls, but it shows little sign of sales recovery, and it is a long, long way off of being a normal functioning market.

Rob Kitchin

Both the Irish Independent and The Irish Times have, in recent months, discussed a supposed shortage of housing stock, and associated price-rise, in South County Dublin. While, when taken at face value, there may be some form of truth to the claims, there is a need for extreme caution in focusing the wider debate on one particular geographical location, particularly in light of such uncertain economic times. In line with recent posts on this blog, the role of the media is of significant importance in influencing these discussions. To take just one example, in the last number of days The Irish Times ran with the headline: House prices in south Dublin up 12.2%, survey shows’. Through reading this article, however, it became apparent that what was being referred to was asking prices as opposed to selling prices. This may seem relatively harmless, yet it has some important repercussions. In another piece later the same day, Michael Noonan, in response to the previous article, mentioned the need for 30,000 new dwellings per year and commented as follows: “Dublin as in many other areas is giving the lead and south Dublin is giving us a strong lead according to one survey prices are up 12%… These things can change very rapidly.”

Such rhetoric raises some important questions. Should there be a rush to build more housing in South County Dublin? Is it in the interests of good planning to maintain housing levels in this area and further pursue a completely disjointed approach towards the delivery of housing more generally. While it may also be argued that this shift is indicative of a more general turnaround in property prices throughout the country, there is a much wider debate to be had. When viewed another way, the rise of property values in one specific geographical area of Dublin could be looked as being indicative of a severely imbalanced social, economic and political system.

Eastern Docks, Amsterdam

As I have argued before, is now not the time to put in place measures that might actually promote more socially balanced cities? As highlighted by Michael Noonan in the above-mentioned article, there is an assumption that market forces will lead to families departing from apartments to houses. However, and not withstanding the importance of wider debates about one-off housing etc., within the larger urban areas, a key challenge lies in dealing with issues such as suburban sprawl, high levels of vacancy within central areas, and the promotion of more socially-balanced cities.

While we should be careful not to place those cities often cited as having a high quality of life, such as Amsterdam, Vienna or Copenhagen, on a pedestal, it is of note that, relatively speaking, they each have a history of strong centres and suburbs as well as more balanced social structures. The relationship between these various factors is, I would argue, a much more important debate to be had. The current obsession with house prices in one particular part of the country does little more than to replicate the same problems of the boom years. Mainstream media can play a key role in ensuring that such rhetoric is challenged and debated at every turn. I would go as far as to say that it has a duty of care to do so.

Philip Lawton