Business Irish

Monday 27 January 2020

Number of new homes is up 66pc but total still low

Donal O'Donovan

Donal O'Donovan

THE number of new houses being built has increased sharply as construction has gotten under way at developments, many of which had been stalled for six years or more, according to two sets of research published today.

Nationally, both the number of planning applications and actual building starts rose sharply in the first six months of the year, according to a National Housing Construction Index prepared by research firm Link2Plans.

The number of housing starts was up 66pc in the period compared to the first half of 2013, while one fifth more planning applications were lodged with city and county councils across the country.

The totals remain low however. There were just over 4,000 housing commencement notice filed with local authorities in the first six months of the year. The Economic and Social Research Institute (ESRI) said last week that we need to build about 12,500 units a year up to 2021.

So far this year, the research records an increase in new starts in every county except Roscommon in the first six months. The picture for planning applications was more mixed, with 14 counties recording an increase and 12 seeing declines.

In part the increase in commencements reflected a surge in paper work for new schemes being filed before a rule change in March, with the pace of activity tapering off after the deadline.

Unsurprisingly, Dublin recorded the biggest increase in the number of housing starts - with 916 commencements compared to 593 in the first six months of 2013.

In Cork, the numbers increased by 270 to 512 and Donegal also saw big surge in housing starts to take its total to 244. In percentage terms Westmeath saw the biggest increase (189pc) though the total number of starts increased to 55 from 19.

In terms of planning applications Dublin clocked up the biggest increases both in absolute numbers and percentage terms. Planning authorities received 2,228 planning application in the capital between January and the end of June, up from 1371 a year earlier.


Even after the latest pick up activity is far below levels seen in the boom, or even in the years before.

However, the recovery is translating into jobs, according to separate research by Ulster Bank. Its purchasing managers' index (PMI), based on a survey of managers in the sector, shows direct recruitment of builders increased for an 11th straight months in July. Firms also used more sub contractors, whose prices increased at the sharpest pace since 2004.

There was a pick up in house building and commercial property construction, such as office and retail schemes, in July, but civil engineering activity was down, the Ulster Bank survey shows.

The research backs up anecdotal evidence that more builders are going back to work after seven years of virtual standstills.

In Dublin in particular, where sharp house price rises are blamed on a lack of new homes, builders' trucks and site hoardings are starting to become common again as the sector in general shows signs of grinds back to life.

Ulster Bank's chief economist Simon Barry said the level of housebilding remains "extremely low." "Nonetheless, the evidence provided by the PMI - and indeed other data sources, including Department of Environment figures on house completions - indicates that housing activity trends are clearly on an improving trajectory," he said.

Irish Independent

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