Executive Needed to Deliver on Northern Ireland Housing Crisis
For all too brief a period on a freezing cold Wednesday afternoon, all eyes were once again cast on an Assembly Chamber filled with MLAs. If the ice stubbornly clinging to the Stormont windows was symbolic of progress and mood inside, a glacier would be more demonstrative of progress outside.
The issues are well documented, repeated and worn. Northern Ireland is grinding to a halt. Its people are struggling and most frustratingly of all, receiving no help.
In the party rooms of Stormont on that Wednesday afternoon was a recently distributed Housing Rights MLA Bulletin, recommending policy solutions to a housing crisis that is tightening its grip amid this period of inaction. Solutions, which are informed by those with very real lived experience of homelessness and housing struggles.
Yet much like the various crisis descending on all sectors in Northern Ireland, debate on this issue and its solutions was absent in the Assembly Chamber. A failure which much be rectified immediately.
Social Rented Sector under significant strain
Let’s take a look at just some of the numbers which demonstrate a housing crisis in Northern Ireland.
In the Social Rented Sector, there are over 45,000 households on the social housing waiting list, the highest amount ever. Over 33,000 of these households are deemed to be in housing stress.
In 2022-23, over 8,000 households were accepted as statutorily homeless. Of the 45,000 households on the waiting list, over 26,000 are statutorily homeless.[1]
In 2022/23, there were over 10,000 placements in Temporary Accommodation, an increase of 206% on the 2018/19 figures.[2] As of July 2023, there were 4,569 children in Temporary Accommodation on Northern Ireland.
Private Rented Sector facing ‘unprecedented and rapid prices rises’
The situation is no less dire in the Private Rented Sector (PRS), where rent prices are rapidly rising, placing financial strain on thousands of low-income households, and testing the limits of affordability across Northern Ireland.
As of August 2023, average rent prices were rising in Northern Ireland at a rate of 9.6%, the highest rate of increase in the UK. As of Q3 2023, the average rent price of properties in Northern Ireland was £810 per month. This represents a 17% increase on Q3 2021, when it was £691.
The rising price of rent in the PRS can be explained by demand far outstripping supply, particularly since the pandemic. According to PropertyPal, in figures presented at Housing Rights’ most recent PRS Conference, rental stock is down 43% compared to pre-pandemic levels. The average number of days private rented accommodation remains on the market is 25 days, compared to 38 days pre-pandemic. PropertyPal received an average of 10 enquiries per rental property advertised before the pandemic. As of November 2023, that had increased to an average of 60. A deeply worrying situation and indicative of an unhealthy market.
In its most recent analysis of the PRS, Ulster University specifically highlights lack of stock as a key driver of recent rent inflation, as agents interviewed as part of the analysis consistently raise this as the main contributing factor. The outlook for the future is equally as bleak, with one commenting that, ‘lack of stock is a key issue, and I can’t see enough properties coming to market in the foreseeable future.’
The analysis uncovers knock on effects of this, as agents report an increase in the number of tenants refusing to leave a property when served notice as they are unable to find affordable accommodation elsewhere, a deeply worrying development.
Another key contributor to rent inflation links to the impacts presented by a challenging economic climate. At Housing Rights’ PRS Conference, Jordan Buchanan, Chief Operating Officer of PropertyPal in Northern Ireland, highlighted the falling levels of housing affordability in Northern Ireland as a result of interest rate inflation combined with a cost-of-living crisis, impacting on people’s ability to secure mortgage.
Essentially, as less people can afford to buy a home, households are being driven into or forced to stay longer in the PRS, creating excess demand that is far outstripping supply.
This excess demand without the stock to accommodate it not only creates rent inflation, but stifles space and cuts off access of entry to the sector at an affordable price, forcing out those whose affordability limits have been surpassed. Often into homelessness and onto the already pressurised social housing waiting list.
A Cross-Tenure Housing Crisis
Housing Rights, through our experience with the people who contact our helpline for help and advice every day, has been watching a housing crisis unfold in recent months, and have termed it as such. While it is deeply worrying that Ulster University has reached a similar conclusion, we welcome that the urgency and magnitude of the issue is being acknowledged. Politicians must take heed.
The social housing waiting list is the largest it has ever been, with over half households on the waiting list considered to be statutorily homeless. Housing allocations are the lowest they have been for 20 years, while Temporary Accommodation is at crisis point.
Meanwhile, the waiting list is being added to through unprecedented numbers of tenants being unable to afford to live in the PRS. 2,218 households presented as homeless in 2022/23 due to loss of private rental accommodation, the largest cohort ever in published statistics beginning in 2002/3.
A perfect storm of unprecedented rent price increases, fourteen consecutive Bank of England mortgage interest rate hikes from 0.1% to 5.25% between December 2021 and August 2023,[3] unmanageable affordability issues and a dearth of affordable stock with no sign of relief has left private rented tenants in crisis. Thousands of households are unable to afford to keep their home in the sector and are either being forced to refuse to leave a property and risk court action, or to present as homeless. If no supportive measures are introduced, the spiralling crisis in the private sector will continue to contribute to the crisis in the social rented sector.
Decades of underbuilding
At the heart of issue is supply, and as pointed out above there are a myriad of factors putting pressure on current housing supply.
All of these factors however, would be less damaging if we address the simple but fundamental issue at the centre of Northern Ireland’s housing crisis. We do not have enough homes and we are not building enough homes, particularly at the more affordable end of the scale.
At Housing Rights’ recent PRS Conference, both Jordan Buchanan of PropertyPal and Kieran McQuinn of the Economic and Social Research Institute pointed to decades of underbuilding which has led to this point.
Shared with the Conference was the fact that from 1970 to 1990 in Northern Ireland, an average of 4,500 social houses were built per year. Since 1990, this has plummeted to an average of 900.
The State withdrawal has meant that house building since 1990 has largely been left to the private sector, which has still yet to recover its output to the levels prior to the 2007 financial crisis.
It is clear now that private sector output is not sufficient to meet need in Northern Ireland, and the consequences of this are now reaching boiling point.
The State must step in to address this lack of building. Tentative steps have already been taken to meet this challenge, with the Northern Ireland Housing Executive (NIHE) publishing plans to borrow to invest in house building again. This must be done in a way that retains accountability and does not result in rapid inflation of rent prices for social tenants.
A restored Northern Ireland Executive must examine as a priority all policy options to increase supply, including direct funding of publicly built social housing, and stimulating affordable house building in the private sector through incentivisation.
Housing is in desperate need of a functioning Executive
A crisis in housing is upon us. The economic chaos facing Northern Ireland is deepening with every passing week, impacting all sectors, and is now impacting people’s ability to maintain or find a home.
A safe home is the foundation from which people build their lives, families, careers and stability. When people are deprived of this foundation and become homeless the journey back is long and extremely difficult.
People are becoming homeless in their thousands in Northern Ireland, a number that is increasing with every day this crisis persists. The lack of government has allowed this issue to drift for too long. The Executive must reform immediately and address the unfolding housing crisis as an urgent priority.
Reason for hope
While the challenge to address the housing crisis is vast and of critical importance, there remains a window of opportunity which, provided local politicians act swiftly, can alleviate the immediate pressures on tenants and homeowners and provide the space for a long term, strategic approach to housing in Northern Ireland.
This includes making housing a stand-alone outcome in any future Programme for Government. The inclusion of a specific housing outcome will not only place addressing the housing crisis at the heart of government, as its urgency demands, but is vital for the cross-departmental commitment needed to tackle the crisis.
This cross-departmental commitment to preventing and alleviating homelessness needs to be enshrined in law, becoming a statutory responsibility. Any new Executive must introduce a statutory duty to co-operate on relevant bodies across housing, communities, education, justice and health to prevent and alleviate homelessness.
Our full list of policy recommendations can be read here. We believe these recommendations will go some way to alleviating pressure on the sector within resources that are currently available. But at the heart of the crisis is supply, and supply must be addressed urgently upon restoration of government.
[1] Stats provided by NIHE via Housing Rights request
[2] Stats provided by NIHE via presentation at Housing Rights event
[3] https://www.bankofengland.co.uk/explainers/why-are-interest-rates-in-the-uk-going-up