Increase in planning permissions granted for apartments

Increase in planning permissions granted for apartments

There has been a significant increase in the number of planning permissions granted for apartment developments.

New data compiled by the Central Statistics Office (CSO) shows a 156% increase in the number of apartments approved in the second quarter of 2019 in comparison to the same three months in 2018. For the same period, there was a 0.3% decrease in the number of housing units approved.

In total, planning was approved for 9,611 units in the second quarter of the year, 4,675 of which were apartments and 4,936 were houses.

This means that in the first half of the year, more than 17,000 units have been approved by local authority planners - an increase of 2,500 on the first six months of last year and almost double the 9,103 approved in the first half of 2017. The report does not include any information on how many of the approvals have actually commenced construction, though.

The CSO report notes that while the number of housing and apartment units approved is similar, the floor area for apartments is 52% that of houses. The total apartment floor area approved is 390,000 sq m, while for houses, it is 781,000 sq m.

The report also shows that one-off houses accounted for 14.4% of all new dwellings granted planning permission in the second quarter.

Construction activity continues to grow, with the 17,000 units approved in the first half of the year more than the same periods in 2016, 2017 or 2018, suggesting that this year will see another increase on the total number of approvals.

Unsurprisingly, the largest slice of development is still concentrated in Dublin and the commuter area around the capital. The Eastern and Midland region saw 3,189 planning permissions approved in the second quarter, of which 1,718 were in Dublin. In comparison, there were 1,131 in the south-west, of which just 129 were in Cork city. The Northern and Western region saw 1,310 units approved.

The spike in apartment approvals comes a year after Housing Minister, Eoghan Murphy, relaxed the restrictions related to the construction of apartments. In March 2018, he announced changes to minimum size guidelines and removed the requirement for the inclusion of parking spaces in such developments.

He also increased caps on the number of units per floor and dropped requirements for apartments to have windows on two walls. There were also changes to the height restrictions on residential buildings.

Many of the changes were criticised at the time but Mr Murphy claimed that it would address the challenges facing developers, including making it more cost-effective to build apartments.

A recent analysis of the cost of building apartments carried out by EY-DKM Economic Advisory on behalf of Cork Chamber and the Construction Industry Federation claimed that up to 56% of the costs of apartment construction come from the physical costs, with a further one-third of the sales price taken up by taxes and charges.

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