Ireland’s planning system is “broken beyond belief” and exacerbating an “excruciating housing crisis”, says John Moran, chief executive and head of capital markets at JLL Ireland – but he has hope that reforms being pushed through this year could mean some change.
The country is undergoing significant planning and development reform amid one of the worst housing crises it has seen in years, as the government prepares to usher in new regulations under the Planning and Development Bill 2023.
“We have an excruciating housing crisis, and finding accommodation for people is difficult,” said Moran (pictured). “We need, conservatively, to build 50,000-60,000 homes a year and we’re building about 20,000-25,000 at the moment. As each year goes by, the problem gets worse.”
A draft of the Bill was approved this March and was due to be finalised during the second quarter, but it is still passing through the Houses of the Oireachtas, the Irish parliament, where significant amendments may be made.
The major change proposed by the Bill is tighter deadlines for planners and local authorities on granting or denying planning permission to speculative developments.
“There is a massive issue with the planning system,” said Moran. “It is chronically broken beyond belief.”
As of February this year, around 70,000 homes were awaiting decisions after being appealed to planning body An Bord Pleanála or to the courts, the Construction Industry Federation said. This delay adding to the cost of housing and the country’s already fierce housing demand.
This is the result of a system that Moran said is both “too democratic” and slow. The system allows objections to schemes from any citizen of Ireland, at which point a scheme will go to appeal at An Bord Pleanála where it will be adjudicated.
At this stage, the applicant “can take a judicial review against [the decision] so you can bring it to the high court” for review, if the decision is thought to be unlawful.
In April, EG reported that Savills Ireland had called the country’s National Planning Framework “fundamentally flawed” and a catalyst for the housing crisis, in a view that is closely echoed by Moran’s.
“A local authority in the normal course of events has two months to grant a decision,” he said. “But what they do is say in the last two months ‘we need some additional information’, and two months could take 12 to 18 months.”
This means applications in review are effectively kicked down the road, which “when you’re borrowing money for development, mitigates against development,” Moran said.
“The timeline is a local emergency,” he added. “And we seem to have an inability to deal with it for some reason.”
Proposed changes to the system in the Bill have been designed to “speed everything up” in an attempt by the government to curb delays and encourage construction of new homes. But Moran added that cost and resources for local authorities are also factors.
“The legislation will be fine,” said Moran. But without a better resourced planning board and local authorities, he added, local government will continue to be “very sleepy when it comes to real estate”.
Even with the new Bill placing tighter deadlines on planning decisions, “housing will take time to deliver”, Moran said.
What else could be done to help rectify the issues? For Moran the solution lies in the coming together of the public and private sectors.
“It doesn’t go down well in government circles, but I would hire somebody who knows what they’re doing from the private sector, make them the tsar of planning and say, ‘right, you go in and sort all this out’ and give them the necessary powers to do it,” he said.
There has been noticeable “growth of the build-to-rent sector, which didn’t exist [in Dublin] four or five years ago,” according to Moran. This has meant that the housing shortage is somewhat lessening and the sector is “starting to meet some of the needs in the city centre” of Dublin.
He is hopeful that the new Bill is “a big improvement on what we have at the moment”.
“Any developer you speak to will say that to you,” he added.
“They’re not prepared to take the risk on planning. Planning should be a risk but it shouldn’t be an unknown risk. Some developers do try to stretch the envelope a little bit, but if you’re doing that and you get turned down, that’s your prerogative.
“Everybody is a big boy in this industry, they know what risk they’re taking. But when the risk is unknown and uncontrollable, it’s very hard to deal with.”
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