Building hope despite projects 'put on hold'
BUILDERS and developers are opting to postpone rather than cancel further construction projects, a survey of local authority planning applications and project commencement shows.
Link2plans, the research company which conducted the survey, said planning applications were down nationwide by 20pc on last year, compared with 23pc the previous year. Building commencements are down 13pc.
However "extension of duration" applications, by which developers and builders seek to extend permission for projects after their five-year expiry period, are up by 16pc.
Link2plans MD Danny O'Shea said: "On one hand we can say that they're not going ahead with construction plans in the current market which is not good, on the other hand we can say that they're still not prepared to give up on their projects either, which has positive implications for the industry in the coming years.
"It could be that builders can't get the finance to go ahead or because they don't believe the market is ready. However, the fact that they're reapplying means they're still hoping to go ahead, just not this year."
For its part, the Construction Industry Federation (CIF) says that the average house price will have to increase by €30,000 before its members return to residential property development as a financially plausible business.
Hubert FitzPatrick, the CIF's director of development, housing and planning, said it costs €200,000 to build a three-bed semi in the current market, excluding the cost of the land. This would have to reach €230,000 before his members considered a return to this market.
The most recent house start figures from the CIF show that just 800 homes were started in the first three months of the year, 92pc of which were one-off houses. Overall housing starts are down 43pc on 2011; and it looks like just 7,500 will be built in Ireland this year.