Saturday 21 September 2019

Delivery of new homes in Dublin slows in 2019

Housebuilding in capital has stalled with family homes showing biggest declines, writes Michael Cogley

Newly-built homes are required by law to attain a BER rating, which testifies to the energy efficiency of the dwelling (stock photo)
Newly-built homes are required by law to attain a BER rating, which testifies to the energy efficiency of the dwelling (stock photo)

Michael Cogley

The construction of new homes in Dublin has begun to slow in the opening months of this year, a new study has found.

Newly-built homes are required by law to attain a BER rating, which testifies to the energy efficiency of the dwelling. The ratings have been regarded as one of the most-reliable indicators of housing output.

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In the period to the end of May, 671 BER ratings were issued, according to research conducted by Passive House Plus. That was down significantly from the 1,053 ratings registered in the same period last year.

Author of the report and editor of Passive House Plus Jeff Colley said that the bulk of BERs are finalised in the second half of the year but that the opening months offer insights into likely trends for the year.

"The early data indicates that the only house type that is continuing to see growth in Dublin this year is apartments, with both terraced and semi-detached homes showing substantial declines," Colley said.

"This decline is more marked given the bad weather we had for a lot of the first quarter of 2018, which slowed down construction output. The remarkable growth that we had seen from between 2016 to 2018 appears to have ended."

Colley said that the affordability of new homes had become a significant issue due to the "very sensible" lending restrictions implemented by the Central Bank and soaring house prices.

Outside of Dublin, regions showed continued growth across all categories except for apartments.

"If the remainder of the 2019 data is consistent with the early BERs then we are expecting that 16,873 new homes will be built this year, which represents a 4pc drop from our estimated 2018 total of 17,520," Colley said.

The Government has introduced numerous measures to spur apartment building in recent years. Among them was a reduction of minimum standards which allowed for the removal of car parking spaces and an obligation to provide dual-aspect units.

The Department of Housing said that it will "closely monitor" the market and introduce policies to ensure the "strong recovery observed in recent years". The department also said that official estimates stated that the delivery of new homes had improved in the opening months of the year. However it also said that forecasts among various market observers have not formed a consensus.

Housebuilding in Ireland has continued to grow from a low base over the last number of years. According to the State's figures there were 9,909 homes built in 2016, 14,399 in 2017, and 18,023 the following year.

Last week, Goodbody chief economist Dermot O'Leary forecast that fewer homes would be built this year than previously expected. He said that around 21,000 new homes will be delivered this year.

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