Ireland’s housing crisis is “completely normal” and its level of homelessness is one of the lowest in Europe, outgoing chairman of the Government’s Housing Agency Conor Skehan has said.

Mr Skehan, who departs the role next month, said the agency had warned the Government and the Minister for Housing against “sowing the seeds” of the next housing crisis through excessive intervention in the housing market.

Speaking at the Urban Land Institute conference in Dublin on Thursday, Mr Skehan said Irish people were guilty of “insular thinking” in relation to the housing crisis.

“Our housing crisis is completely normal. Every country in Europe has equivalent issues in terms of affordability, in terms of homelessness, in terms of the appropriateness of the mix,” he said.

“One of our tragedies of living on an island is that we are a people who indulge in insular thinking. Ireland’s ratio of homeless people per head of population is in fact one of the lowest in Europe. Counties like Germany, like France, like our near neighbours in Britain have three times the levels that we do.”

Ireland had managed to survive one of the most “extraordinary economic declines ever experienced by any western democracy”, he said, but he added that the country was at a dangerous point in the recovery.

Classic period

“We are at the end of a classic five-year period, which occurs at the end of a housing crash. The first two years are stopping to work out has the actual building finished collapsing around us.”

This was followed by a three-year period where developers assemble sites, secure finance, and seek planning permission, ahead of restarting construction, he said.

“We are exactly at year 4½ of that five-year period. Year 4½ is always characterised by the sense that there will never be any more housing. This is the period when governments panic, when policymakers panic; this is the period where plans are put in place that produce the next downwards cycle.”

Next housing crisis

It was at this point that the seeds of the next housing crisis were in danger of being sown, he said.

“The thing that causes oversupply begins right now – the financial incentives, the loosening of credit terms, the expansion of planning capacity, begins right now at year 4½.

“We in the agency are saying to the Government, to any Minister we can lay our hands on: ‘Enough of the initiatives – let us get on with the recovery in an orderly way.’”