Wednesday 23 October 2019

Insurance warning as cost of rebuilding home rises

(stock photo)
(stock photo)
Charlie Weston

Charlie Weston

Homeowners have been warned to review their insurance cover after a new survey found the cost of rebuilding a home has risen.

The Society of Chartered Surveyors said rebuilding costs were up 6pc in Dublin in the past year, and 8pc outside the capital.

There is a huge risk people will not have sufficient cover in place if their house burns down or is badly damaged, experts said.

Figures compiled show it now costs €78,000 more to rebuild a three-bedroom semi in Dublin than in the north-west of the country.

In a new guide on the likely costs of rebuilding a 1,023 sq ft home, the surveyors found that it now costs close to €208,000 to rebuild a three-bed Dublin home.

The cost in Cork has gone up 8pc to €165,000, with similar percentage rises in rebuilding costs in Limerick (€163,000) and Galway (€160,000).

Waterford rebuilding costs are now €151,000 for a typical three-bedroom house.

The cheapest place to rebuild a house is the north-west, in counties including Donegal, Cavan, Sligo, Leitrim and Monaghan.

It costs €130,000 to replace a home in that region.

Payouts

Insurance experts warned that if you have your house insured for €200,000 but it costs €220,000 to rebuild it after the likes of a fire, then the insurer may only pay out €200,000.

The same principle applies if the house is only partially damaged, but is not insured for the full cost of reinstating it. The insurer will only partially cover the rebuilding cost.

Costs associated with rebuilding a home are separate to its market value.

President of the Society of Chartered Surveyors Micheál Mahon said there had been a rise in construction costs in the past year.

"The construction sector is experiencing high levels of activity, and this increase is having an inflationary effect on construction prices," he said.

"There are simply not enough construction workers to meet demand and as a result, wage costs are rising."

A House Rebuilding Calculator and the 2019 Guide to House Rebuilding Costs is available free of charge at www.scsi.ie.

Irish Independent

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