Permission in place for 23,000 homes but few being delivered
Planning permission is in place for almost 23,000 homes across Dublin but only a fraction are being built due to a lack of finance.
New figures from the Department of the Environment show there is no shortage of planning permissions in place, but that much needed houses and apartments are not being delivered.
The reasons include the high cost of building and inability of builders to secure the necessary finance from banks.
This is despite a need for around 6,000 new units to come on to the Dublin market every year, just to keep pace with growing demand and to allow people get a foot on the property ladder.
The figures show that the vast bulk of permitted homes are in one of the country's fastest-growing areas, Fingal in north Dublin.
But separate figures from the Dublin Housing Taskforce show that despite the large number of 'unused' permissions already in place, developers are securing approval from local authorities for other developments.
The figures show that last year, councils had received applications to build 6,912 homes. If approved, it would mean there was capacity to deliver more than 30,000 units - around five years' supply in the capital. "It's killing us that in broad terms the stock of planning permissions is increasing, but we're not seeing those permissions convert into starts," one source said.
"It's not a land issue, it's an economic issue. The economics of housing construction are such that there's effectively a ceiling on what people can borrow under Central Bank lending rules, but the housing sector is saying that, bar exceptions such as finishing off sites, the delivery price of a home is in many cases higher than what the market can bear.
"Builders are building on the basis of deposits secured. What we're not seeing is building forward in any kind of speculative sense."
Last year, just 12,666 homes were completed across the country. In Dublin, fewer than 3,000 were delivered, around half of what is required.
One of the key providers of starter homes in the coming years will be the State bad bank Nama, which has promised to ramp-up delivery of units costing no more than €320,000 between now and 2020.
It will directly fund developments, and also enter into joint venture partnerships to develop sites. It currently has 40 active sites across the capital, but says works on around 100 will be needed to deliver 4,000 homes a year over the five-year period.
It plans to provide dedicated financing of €5.6bn over the period, and has earmarked delivery of 6,100 homes across eight 'clusters' in the capital by 2020.
Around 93pc of its funding will be earmarked for the Greater Dublin Area, with 78pc in the city, 15pc in the commuter counties of Meath, Wicklow and Kildare and the remaining 7pc in other counties. The focus will be on starter homes.
While the Government has taken some action to address the housing shortfall, including rebating development levies for starter homes and reducing the number of units which must be available for social housing, the figures show that progress remains painfully slow, particularly in areas of high demand including Dublin, Cork and Galway.
In Dublin, works are underway at 90 sites across the city, but only a portion of units permitted are being delivered.
This is because in many cases, banks are unwilling to fund works unless buyers are in place.