Friday 9 December 2016

House building up - but delays of up to three years hampering delivery

Published 11/03/2016 | 02:30

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It takes more than three years for construction work to begin on housing projects after the plans are first lodged with local authorities, a new report says.

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The Building Information Index says that work began on some 18,273 homes last year, which will yield 8,215 units in Dublin alone, but warns of long delays between planning applications being lodged and work commencing on site.

The warning comes as the number of homes being built falls way short of the number needed to keep pace with demand.

Just over 12,000 units were completed in 2015 - but around 25,000 a year are needed.

However, the index says that investment in housing has substantially increased, with a sharp rise in the number of starts in Dublin, where demand is highest.

"The really good news for all those looking at the residential construction sector is that the growth in project commencements was up 114pc, a doubling of output up to €2.74bn in 2015 when compared with the previous year," said Danny O'Shea, managing director of Building Information Ireland, which compiles the index.

The total value of all construction projects started last year doubled compared with 2014. Projects totalling €6.12bn were started, compared with a value of €3.19bn in 2014.

Residential construction is the most dominant sector.

The report also says that projects with a total of 18,273 residential units commenced construction in 2015, up from 9,883 in 2014, a rise of 85pc.

The largest growth was felt in Dublin, up 134pc, where work on 8,215 units began.

It was followed by the rest of Leinster, with 5,382 units (up 82pc).

Munster saw growth to 3,159 units (up 64pc), but there was little change in Connacht/Ulster, where work started on 1,517 homes, up just 2pc.

"The focus on residential construction remains strong and all of the vital signs are positive according to the data contained in the Building Information Index," Mr O'Shea added.

Last year, planning permission was sought for 44,733 homes, an increase of 27pc, which involved a construction value of €8.23bn.

But while it takes an average of 75 weeks for a construction project to get from the planning application stage to work starting on site, the period is far longer for homes.

It can take 138 weeks for residential projects to get through this process, eight weeks longer than in 2014. The best sectors for speed from application to commencement were education and agriculture (both 52 weeks), followed by industrial at 54 weeks.

"Construction projects are slowing down getting from application phase to commencement on site, with the average length of time for a residential project to get from application to actual construction work [being] 964 days," Mr O'Shea added.

Irish Independent

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