Housing deficit continues despite increase in supply

Housing deficit continues despite increase in supply

By Catherine Shanahan and Fiachra O Cionnaith

A sizeable increase in housing supply will still come nowhere near meeting estimated annual demand, based on figures released yesterday by the CSO.

A 30% jump was recorded in the number of new homes completed for the first six months of 2018, compared to the same period last year, rising from 6,070 to 7,909. However, if the rate of completion continues, the end of year figure is unlikely to reach 20,000.

Experts estimate 35,000 to 40,000 units are needed annually to meet demand. Goodbody chief economist Dermot O’Leary recently told the Irish Examiner a “significant supply deficit” will remain up to 2020.

Brokers Ireland, the representative body for insurance and financial brokers, said the latest figures were “much improved on last year” but were “coming from a very low base”.

Rachel McGovern, director of Financial Services, said continuing poor supply put more pressure on the market.

“We’re seeing that in the tragic homeless figures and in the very high rents people are paying while the market remains dysfunctional,” she said.

“Supply is the only answer, and all Government effort should be focused on it.”

However, Taoiseach Leo Varadkar said he was “pleased to see that, in the last three months, 4,400 new homes have been built in Ireland”.

“That’s a 34% increase on the same period last year,” he said. “So I think it puts us in a good position of meeting our target of building 20,000 new homes by this year.

“We have a housing crisis in Ireland, the solution is to build more homes and new homes, and that is happening. It is going to take time, but we are getting there.”

==============The CSO report found:

  • Scheme developments accounted for more than three in five home completions in the second quarter of 2018;
  • New dwelling completions were highest in Dublin at 1,804, followed by the Mid-East at 870. The two regions combined accounted for three-quarters of all scheme dwellings completed in the second quarter of 2018;
  • Dublin 15, which includes Castleknock, Tyrrelstown, and Blanchardstown, was the Eircode area with the highest number (308) of new dwellings completed;
  • Meath, Kildare, and Cork recorded more than 200 new scheme dwellings each in the second quarter of this year;

  • The South-West was the region with the most single dwellings completed, led by Co Cork with 175. Overall, 798 homes were completed in Cork in the first six months of 2018;

Tánaiste Simon Coveney said more homes were completed in the first half of 2018 than for the whole of 2011, 2012, 2013, 2014, and 2015.

He said the housing crisis was “the longest-lasting legacy of the bailout”, “but today’s figures show that not only are increasing numbers of houses being completed, but now they are being delivered at a much quicker pace”.

The CSO’s “new dwellings completion” series provides the first accurate picture of residential construction rates in the Republic.

The CSO started its new series as former estimates, used by officials based on electricity connections, overstated the number of new houses that are under construction.

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