We live in a complex world. Systems and processes developed in the private sector interact with and are formed by government policy. Differing political ideologies try to move the needle one way or the other, as can be seen in the current debate in Ireland about housing.
The current debate isn’t fixing anything.
- “The state has a responsibility to its citizens.”
- “Private companies building homes need to make a profit.”
- “Home building shouldn’t be intertwined with profit-making.”
- “Basic market forces are all we need to deliver homes as cheaply as possible.”
- “The private sector goes for maximum profit to the detriment of real people.”
- “The state can’t do anything efficiently.”
- “The state was delivering homes for our people decades ago. We should do it again.”
- “Our housing system, economy and ability to provide finance are all set up to give large funds an extreme advantage as regards housing.”
- “We shouldn’t villify people willing to invest in Irish housing – they are providing roofs over people’s heads.”
The debate which is taking place right now in Ireland is risking the unhelpful reduction of the complex nature of housing provision down to a binary argument. Off or on. One or zero. Up or down. Left or right.
The arguments are stale.
It also seems that the argument is stale. State or private sector. In our modern world, with all sorts of amazing technologies changing whole industries, it seems less than productive to polarise problems such as the housing crisis as “the state” on one side, versus “the private sector” on the other, as this runs the risk of ruling out ideas just because they don’t strictly adhere to a particular ideology.
I’ve spent many years working with people who were designing, building or buying their home. I’ve closely studied and been impacted by the state’s management of property as we tried to sort out our banks. I’ve studied the property market for years as we moved into recovery after years of stagnation and I’ve watched on with frustration as we ended up where we are.
It occurs to me that there are two basic things wrong with how we manage the provision of housing. THis applies everywhere – not just Ireland.
1) We are failing ourselves by allowing systems to develop and continue to influence and control housing provision which don’t recognise humanity’s need for housing as a source of confidence and strength, instead of a weakness which divides us
2) The processes of the property industry, once the enablement of huge transformation in living standards, are now hugely restrictive and counter productive. They are actually the cause, in my opinion, of the 2008 property crash in Ireland. (For more on how we intend to fix this issue, while enabling ‘estate agency’ to flourish as a concept and business model , see this video.)
As Homebuyer’s Hero commences commercial activity, it will change the way property is brought to the market by re-ordering the steps a home builder would normally go through, in order to bring a new development to the market. We will enable this by allowing both the ‘need’ and ‘demand’ for housing to be seen, felt and be influential at a much earlier stage in the whole process of bringing a development to fruition.
How will it make a difference?
This will allow for much lower risk across construction finance for a given project by having the buyers ready and waiting before any appreciable expenses are incurred. It will also have these positive effects:
- Many more home builders will be able to “get into the game” due to the de-risked nature of projects
- Buyers will be able to “shop around” for homes based on new metrics such as the ‘site cost’ component of what they pay for a home, or even ‘builder’s profit’
- Buyer data will drive demand – the market will no longer be product-first
- The mechanism will serve to distance the regular economy from the provision of housing (number 2 above will complete this separation – more in a later post or see this video )
Most importantly, Homebuyer’s Hero will allow our need for shelter to be a source of strength and confidence and an enablement of new home development. All of this will be proven by our first test cases, coming to the market in early 2022.
Don’t let your personal idea of “perfection” be the enemy of “good”
Ideology is fine. Sometimes sincerely held beliefs can drive people to do great things. However, perfection as anyone sees it can be the enemy of “good” or “done”. Innovation can fix many of the problems we are currently facing. Technological advancement in the property sector need not be limited to new materials or methods of construction. Rather than take massive risks with the exchequer and have the state become a builder, why not spend 2/3/4 orders of magnitude less and have the state back a proptech fund aimed at market-healing, innovative technologies? Why not have the best of all worlds? It’s quicker, cheaper and far less disruptive.
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