House building sees 13th consecutive growth year

UP TO 80,000 houses will be built in Ireland this year, with Dublin house prices set to rise by over €200 each day.

Housing accounts for over 60% of total new construction output, which is expected to grow by 1% this year, representing the 13th successive year of growth in the industry.

This is according to the Davis Langdon PKS annual review of the construction industry for 2006.

Managing director of DLPKS, Norman Craig said: “For the 12th year in succession the industry has recorded significant growth, standing at 4.5% in 2005.

“Driven by the completion of a further record of 81,000 new houses, the construction industry is now the most important element of Irish economic growth.”

The construction industry directly employs 250,000 people, 13% of the total workforce in Ireland.

Mr Craig said: “In 2005, we built four times the number of houses in this country when compared with 1992. Housing, having recorded massive growth over the past decade must begin to level off over the coming years.

“In the longer term, we do not believe that there will be a dramatic fall in the number of houses being built. We are of the opinion that there will be a slow decline in the number of completions as the market demand is met and as the demographic figures require fewer houses.”

House prices rose by almost 22% in Dublin last year, with the average time to agree a sale on a residential property in the capital falling below two months.

The price of a second hand home in Dublin rose by 4.3% in the final three months of last year and the average price rose by 209 every day in the three months to the end of December.

This is according to figures released by auctioneers Douglas Newman Good (DNG), which added that demand for houses in Dublin was stronger than usual in the final quarter of last year, buoyed by job creation, low interest rates and immigration.

The latest rise means the average price of a second hand home in Dublin is now €468,273, up from €448,980 at the end of September.

DNG economist Paul Murgatroyd said: “Last year the market outperformed initial expectations with prices climbing at rates not seen for several years and if anything, the second half of 2005 was stronger that the traditionally busier period prior to summer.”