One of the biggest obstacles in trying to address what has been accurately characterised by government as the housing emergency is the lack of reliable and valid data.
2011 – 2015
Central Statistics Office (CSO) figures from the Department of Housing state there were 50,951 new homes completed between 2011 and 2015. However, the actual number of additional households for the period recorded in the 2016 Census, was just 18,981.
Experts point to the ‘ESB effect’: The Department of Housing has opted to count completions based on new ESB meter connections which require new Meter Point Reference Numbers (MPRNs). Most habitable buildings have a unique MPRN identifier with 11 digits. Crucially, for our purposes, when a property has been vacant for two years or more it triggers an ESB Networks requirement for the customer to apply for a new MPRN number whereupon the old number will be cancelled. However, ESB protocol is not meant to identify new homes, but rather to facilitate safe management of the ESB network. It is an imperfect indicator.
What it means is that, for example, completed NAMA units where the meter was cancelled due to vacancy for, in many cases, well over two years, these are in effect counted again as new homes when a new MPRN number is allocated. As a result, thousands of existing vacant homes have been double-counted as new completions over the past number of years. The ‘ESB effect’ also fails to allow for the sub-division of existing homes into flats, the addition of granny flats and many refurbishments (which require a new meter).
The Society of Chartered Surveyors in Ireland previously estimated that this systemic failure in the mechanism used to ascertain the number of new residential units could have resulted in over-counting by up to 20%.
Parallel to the ESB system, since the introduction of the Building Control Management System (BCMS) in 2014, most building commencements and completions have been recorded in an easily read and accurate database. The alternative indicator is to examine the number of Commencement Notices for planned construction site start dates. The BCMS logs building commencements nationwide since March 2014. However, in larger multi-unit schemes the practice is to lodge one commencement notice for an entire scheme or phases which may not be completed for several years. This means that commencement numbers for ‘one-off’ homes are accurate, but numbers for homes on housing estates are inflated and as such are not an accurate indicator of activity.
In addition, this system was adjusted in September 2015 with the introduction of a Statutory Instrument (SI.365) which provided an opt-out for one-off dwellings and refurbishments and for the first time allowed for Local Authority units. Completion submissions are no longer required for one-off homes and are no longer recorded on the BCMS. The Department does not publish BCMS completion figures for ‘estate homes’.
In other words we created an excellent database to record total house completions in 2014 only to undo its usefulness in 2015.
In the two years 2014- 2015, the total number of one-off houses commenced and registered on the Department’s own BCMS database is 5,081. The Department’s one-off new-home ‘completions’ (ESB connections) figure for the same period is over double this at 11,242 individual homes. Official figures do not tally.
2016 – 2017
The Department of Housing claims that over 14,000 new homes have been ‘completed’ in 2016 and a further 17,000 are due for completion in 2017. Market indicators such as new home loans, home registrations,‘one-off’ commencements and ‘estate home’ transactions all point to lower new build levels, almost half the official figure. Based on January-October 2016 figures fewer than 7,500 new-build dwellings were completed in 2016.
So how many new homes are we building?
Accurate CSO data such as new-home loans, BCMS ‘one-off’ commencement levels, Homebond registrations and stamp-duty transactions for ‘estate homes’ all indicate less activity. When these market indicators are analysed, the five year total for actual new-builds is 29,711 versus a Department ‘completions’ total of 50,951. And the actual new-build total may include 9,066 finished-out ‘ghost estate’ partially-completed dwellings that never had an ESB meter installed. The systemic over-counting of new residential units is over 40%, twice that previously estimated by the SCSI.
The numbers of tenants renting may also be underestimated due to CSO measurement methodology. Single owners living in their own home with two student lodgers are counted as one owner occupied home, and the lodgers are not counted. The CSO is not alone in this, its counterparts in the UK use similar methodology.
Therefore policy and management of the housing sector is based on data that are misleading. How can we manage housing if we can’t even quantify it correctly?
NAMA chairman Frank Daly told the Oireachtas Committee on Housing and Homelessness in May 2016: “We inherited about 14,000 empty homes and, working with debtors and receivers, we found tenants or buyers to live in the overwhelming majority of them. This was a significant injection of thousands of units of supply into the housing market…”. A simple way to confirm the extent of double-counting would be to ask the ESB directly how many residential MPRNs were cancelled in the five-year period 2011-2015 inclusive, and how many replacement MPRN numbers were issued. The numbers are significant – over 25,000 cancelled MPRN’s are recorded in a typical year by the ESB and up to half of these are residential properties.
In addition to this, according to media reports at the time, there were 3,000 ‘ghost estates’ containing 69,000 units that needed to be completed.
However, even in the face of an emergency, statistical official inertia drives our evidence-light policy making. Politicians and civil servants are ‘creative’ with words. ‘Allocated and earmarked’ funding means little will be spent. ‘Fast-track’, ‘prefabricated’, ‘modular’ and ‘rapid’ means conventional timber-frame. In 2014 the policy document, Housing 2020, ‘allocated’ €3.2bn and promised 25,000 social homes ‘delivered’ in the next five years. Over the following two years fewer than 200 Local Authority homes were built. Strategic plans have ‘pillars’, ‘delivered’ may mean ‘rented’ and ‘under construction’ means ‘out to tender’ or ‘on the drawing board’. Wordplay is all part of the political ‘game’, to distract from inertia.
The supply of new homes and the capacity of the construction sector are far lower than we are led to believe. If the ‘Rebuilding Ireland’ target of 37,000 new social homes by 2021 sounds familiar, it is. The Department is not just recycling Housing Strategies, it is double-counting homes built.
Maoilíosa Reynolds is a Registered Architect and Certified Passive House Designer.