Six in 10 builders out of work as home sales stall
SIX out of 10 builders are currently out of work while 45pc of construction workers expect no houses to be completed in 2009, according to a new survey.
Merrion Stockbrokers is expecting a 38pc drop in housing completions to 28,000 in 2008.
And 68pc of respondents now say they expect house prices to continue falling in 2009, with land values being impacted significantly.
"The overhang of housing stock is expected to take until at least the first half of 2010 to clear," said Killian Jones, an analyst at Merrion.
"We conclude that there will be about 45,000 units completed in 2008, about 15,000 of which may come from one-off and social housing.
"As a result, we expect that 30,000 private housing units will be completed by the industry in 2008. For 2009, we expect that there will be about 28,000 units completed, a decline of 38pc year-on-year."
The Merrion Irish Housebuilder Survey also showed that many respondents believe that 2009 will be a very difficult year, with some noting indications from the banks that they are going to force people to sell and liquidate holdings.
In addition, many feel the industry is now about survival instead of making money.
The survey also showed that 55pc of respondents believe that selling prices have fallen by 10pc to 20pc in the past year, with 77pc experiencing drops of greater than 10pc.
Over 60pc of those surveyed believe that land prices have fallen by more than 40pc and while prices have been falling significantly, there are no purchasers for land.
Over 50pc of respondents now feel it will take over a year to clear their stock, compared with 30pc in the spring.
"We are now six months further advanced than we were at the time of our spring survey, implying the majority of respondents now expect it will be at least the first half of 2010 before their inventory levels are cleared," said Mr Jones.
In addition, 73pc of responses to how many units are currently left unsold in the market believe that there is between 40,000 and 60,000 unsold.
"Our conclusion from the survey is that housebuilders expect the downturn in the Irish new residential market will be significantly deeper and more prolonged than previously anticipated," he said.
"Price decreases will continue and it will be at least 12 to 18 months before the overhang of stock is cleared from the market."
- Ailish O'Hora Business News Editor
