Learning from Alaska

When we explore, compare and contrast other property markets for the purpose of learning, Alaska is not usually one that comes to mind. However, the city of Anchorage made global headlines this week for taking a new approach to a pretty old housing solution. 

Like most cities around the world, housing in Anchorage is at crisis point, with residents reporting “stubbornly high” rents. The average rent for a one-bedroom apartment in Anchorage jumped 25 percent in the past year alone, the 11th highest jump of any metropolitan area in the U.S. This is pushing people outside of the main urban centres, which has the knock-on effect of longer commute times and the frustration that gives rise to. 

To encourage affordable housing, the city Mayor has proposed a ramping up of ‘accessory dwelling units’ (ADUs). An ADU appears to be the terminology of what Irish homeowners might refer to as a ‘granny-flat’, i.e. a small, own-access, self-contained building that shares resources like a garden or perhaps laundry or storage facilities with a larger home. Many Irish homes already have these, however, they are unlikely to fit the regulatory requirements of a rental unit under the current legislation. Without rehashing the rules banning bedsits in Ireland over the past decade, there is no doubt that enabling the compliant renting of such units would be a quick and relatively easy way to increase the supply of rental properties without requiring new development land and without adding to urban-sprawl. In fact, such initiatives could enhance urban renewal schemes that have fallen flat in recent years. 

Interestingly, the most recent information on population growth in Ireland reveals that of the almost 50 percent population growth (49.6 percent), less than 1 percent (0.7 percent) of this is within urban centres. By way of context, the Greater Dublin Area has experienced 12 percent population growth and the regional areas have experienced an average of 20 percent growth. 0.7 percent in the heart of towns and cities is dismal, and that statistic alone tells a much larger story. We need to use existing buildings better. And this need is amplified in urban centres.

Unlike most political proposals, this proposal by Anchorage’s Mayor appears to have garnered broad cross-party support. 

Would such a solution be considered palatable in Dublin, Cork, Limerick or Waterford? Perhaps.

While sentiment in Ireland is negative towards one-bedroom homes, all data points to the need for more of these. In fact, we need more of everything, no potential solution should be taken off the table.

Ian Lawlor
086 3625482

Managing Director 
Lotus Investment Group