42% rise in planning permissions over first half of year

Planning permissions for new homes are soaring, with a 42% rise reported in the year to June and houses accounting for the vast majority of those granted.

The construction industry has called for simpler planning laws and Vat cuts to stimulate house building.

New figures from the Central Statistics Office show further evidence of the recovering construction industry as planning permissions in the second quarter jumped by 41.8%.

There remains a huge gap in the demand for housing and the supply available, with the construction industry warning of another property bubble.

The CSO said planning permissions were granted for 4,453 homes in the three months from April to June, up from 3,141 on the same period last year. Houses accounted for the vast majority (82%) of permissions. Breaking down the figures, they show that planning permissions were granted for 3,630 houses in three months — an increase of 55.1% on the same period last year.

However, the number of apartments in the pipeline is far less. In the second quarter of the year, permission for 823 apartments was granted, up by 2.7% on the same period in 2016 but down by 8% on the first quarter of the year.

A recent study carried out by officials in the Department of Housing found that it was not financially viable for builders to construct “affordable apartments” with sales prices of between €240,000 and €320,000.

The total number of planning permissions granted for all developments was 6,279. This compares with 5,236 in the second quarter of 2016, a rise of 19.9%. The CSO noted that one-off houses accounted for 28% of all new units in the second quarter.

Total floor area planned was 1,455 thousand square metres in the second quarter of 2017. Of this, 47.9% was for new homes, 36.5% for other new constructions, and 15.6% for extensions. The total floor area planned increased by 16.9% in comparison with the same quarter in 2016. Planning permissions for new agriculture buildings fell to 349 in the quarter from 510 in the second quarter of last year.

While the latest figures indicate a recovery in the construction industry, they are unlikely to have much impact on the housing and homelessness crisis.

A recent survey revealed that while almost 15,000 homes were built last year, 50,000 need to be constructed annually to keep pace with demand. In a pre-budget submission, the construction industry called for simpler planning laws, Vat reductions, and accelerated infrastructure which it says is required to stimulate house building.

Guaranteed Irish, which has 300 members nationwide, among them Irish Cement, Roadstone, Clogrennane, Tegral, Kingspan, and Fleetwood, last week held a roundtable event in Dublin where those in the building industry put forward recommendations to ease the housing crisis. They will be putting these to the Government.

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