Mr Justice Colm MacEochaidh has said “the banking crisis which almost broke the nation” might not have happened had there not been a “planning free-for-all” during the boom years.
“When the history of the past 20 years or so comes to be written, I think we will come to admire those who raised reasonable arguments against ill-advised development."
High Court judge blames boom time
This is one of the major factors in the crisis that does not get nearly enough attention.
An acre of farmland was an asset worth €10,000.
Get it rezoned by the local Council and suddenly you had an asset worth (conservatively) €250,000.
That's is €240,000 of "wealth" created out of thin air by the Council.
Simply by taking that rezoning decision to the bank you could get them to hand over money using the rezoning as collateral.
The banks accepted the Councillors' decision at face value, meanwhile the Councillors had probably been persuaded to rezone the land on the basis that the banks wouldn't be supporting the rezoning unless it was feasible.
Everyone had a get-out clause; everyone had an upside; nobody looked too critically at the situation.
Because of this we ended up with enough land zoned for housing to accommodate a population of 9 million, and enough land zoned for retail to meet the needs of a population of 12 million.
I remember doing a calculation on the values of the land that the various Councils were de-zoning back to agriculture in the aftermath of the bubble, and when the new planning regulations kicked into force.
The figure I came up with, using €250k as the average value of zoned land and €10k as the average value of the dezoned land, was somewhere in the region of €70 Billion.
Pretty close to the €64 Billion the Banks needed to fix them, and hardly a coincidence.