Construction industry calls for VAT cut for first-time buyers

Significant investment in infrastructure is needed if Cork is to act as a true counterbalance to Dublin, the Construction Industry Federation has said.

Speaking at the CIF construction dinner in the Rochestown Park Hotel last night, Aidan Mangan, the chairman of the CIF’s Cork branch called for the development of new railways, a new light rail from Ballincollig to Mahon, cycleways, footpaths, new apartments, and high-density of residence in urban centres.

“We should make no apology for making the argument that as Ireland’s second-largest city, and one which is larger than the next four urban centres combined, we demand the investment that such a centre requires,” Mr Mangan said. “Realistically, no other urban centre is in a position to act as a counterbalance to Dublin.”

The CIF also said politicians and policymakers need to be “braver” to deliver houses for first-time buyers.

The State has intervened in the market to such an extent that it has made constructing houses in the price range for first-time buyers extremely challenging, the federation said.

“For us to produce more, we need the state to take less in the form of taxes and levies,”

Mr Mangan said urgent changes were needed to housing policy, such as a reduction in VAT, development levies, and bonds to make it viable to develop more houses in the price range of €230,000 to €320,000.

“If taxes were reduced, we could deliver units in the price bracket that people can secure their mortgages for,” Mr Mangan said.

“We need our politicians and policymakers to be braver in this regard and take educated and calculated risks, which will benefit this country and the people living in it.”

“Theoretical solutions do not work in an open-market economy, however well-intentioned.”

Last year, the Cork branch of the CIF and Cork Chamber produced a report on apartment viability. This highlighted the barriers to schemes being developed in the region.

“If we are serious about more sustainable development patterns and developing our regional cities, in particular, then the overall apartment delivery costs will have to be tackled. Land costs are not the main problem in regional Ireland with apartment delivery,” Mr Mangan said.

The construction industry is in far better shape than 10 years ago, Mr Mangan said: “The last 10 years have been extraordinary. As people keep saying in our sector, if you’ve survived the last 10, you’ll survive anything.”