5,000 new homes are still not enough for demand
Almost 5,000 new dwellings were built in the third quarter - a 23.4pc increase on the same period last year.
But they are still short by about 20,000 homes, according to industry experts.
CSO data said the total number of new dwellings built in the first nine months of 2018 was 12,582 - an increase of more than 27pc on 2017 but still well below what analysts believe is required.
In the quarter, the number of new apartments built actually decreased compared to last year.
The figures are based on ESB connections. The CSO said it accepted that this metric has been overstating the number of new dwellings, and so it has adjusted the figures to account for that.
The Institute of Professional Auctioneers & Valuers, said while going in the right direction, the figures are still way short of what is required.
Pat Davitt, chief executive of IPAV, said if yearly demand for homes is up to 40,000 then the end of year figure for new dwellings completed is likely to fall short by between 15,000 to 20,000.
"And that doesn't take account of the shortages built up over recent years," he said.
"What is positive in today's CSO figures is that more homes are coming on stream in the areas of greater need - urban areas.
"However, it remains the case that more new homes are needed in both urban and rural areas," he said.
Aaron Willis, general manager of Glounthaune Property Developers, said: "This increase is welcomed, but it does not make up for the fact construction decreased by over 50pc in the last decade.
"What is for sure is that the industry will rise to the challenge and we will ensure the increased volume will be met.
"However, we now need a sustained approach starting with the overhauling and improvement of procurement routes, coupled with a detailed understanding of Government's plans for building in Ireland, so that the industry can plan ahead."