New housing supply reaches nine year high in 2018, remains at half of estimated demand

Stock Image: Bloomberg

Ellie Donnelly

The supply of new housing in Ireland last year reached a nine year high of 18,855.

This represents annual growth of 31pc for the full year, and is the largest annual output since 2009, according to the Goodbody 'BER Housebuilding Tracker'.

However, supply still remains at half of the estimated demand required in the country.

All regions in Ireland experienced double-digit growth in 2018, albeit from low levels.

The fastest growth was registered in the South-East  area  of the country, up 49pc year-on-year, but housebuilding continues to be concentrated in the Greater Dublin Area (GDA).

House completions in Dublin grew by 33pc in 2018 to 7,404, with completions in Dublin’s commuter belt (Mid-East) growing by 34pc year-on-year to 3,955.

Combined, the GDA accounted for 60pc of completions in 2018, relative to population share of 43pc.

"Viability remains the main constraint to building outside of the main urban areas of the country due to the low level of second-hand prices relative to the cost of delivery," Dermot O’Leary, chief economist at Goodbody, said.

There was a rapid increase in large housing schemes in 2018, up 45pc in the year to 11,469. This represents 62pc of total completions.

One-off housing represented a further 25pc of new completions last year, and has been relatively stable over recent years, according to the tracker.

However, apartment completions grew by just 8pc last year.

"Uncertainty around building regulations played an important role in the slow delivery of apartment stock in 2018. However, there has been significant growth in planning applications granted for planning under new guidelines," Mr O’Leary said.

The latest data (12 months to quarter three 2018) shows an increase of 167pc year-on-year in planning approvals for apartments.

"Whilst it is difficult to specify the timing on these developments, there will be a substantial increase in the coming period, with many going into the growing private rented sector. It is needed; Ireland has the lowest share of apartments in its housing stock in the EU," Mr O’Leary added.