House price warning on back of pay hike
The building industry has warned that house prices may soar on the back of pay rises for construction workers.
Director General of the Construction Industry Federation Tom Parlon said there is likely to be a knock-on effect over claims for wage hikes.
His spokesman said he is referring to an 80pc wage claim that Unite has lodged in addition to a 10pc wage hike that has been recommended by the Labour Court.
Employment Minister Pat Breen has accepted the recommendation made by the Labour Court regarding rates of pay for workers employed in the construction sector.
It is the first such recommendation under the new framework that was put in place in 2015 to replace the Registered Employment Agreement system that was found to be unconstitutional in 2013.
Mr Parlon said there is a big labour pressure mounting as the industry bounces back after the financial crisis and "everyone" expects to be paid more.
"No doubt that's going to have an impact on the cost of house building as well, because house building is extremely labour intensive," said Mr Parlon.
"To ensure construction costs don't increase and filter into property prices, the Government must address the level of tax take embedded into every single house built."
He also favours a "tweaking" of the Central Bank rules that allow homebuyers to borrow three-and-a-half times their income, noting that two workers earning €40,000 would only qualify for €280,000.
Mr Parlon also said claims that the Help To Buy scheme is pushing up prices are "way off the mark"