Cairn Homes plans to deliver largest number of new homes this year

Average cost to build a new home jumped €20,000 last year

Michael Stanley, Chief Executive Officer of Cairn Homes.

The cost of building a new home has risen by €35,000 in the past two years one of Ireland's biggest builders Cairn Homes has said.

Publishing a trading update for last year, the company said it sold 1,526 new homes last year bringing in revenues of €610m for a €100m operating profit.

Cairn said its performance was supported by strong levels of demand from first-time buyers, many of whom are availing of Government supports including the First Home shared equity scheme. 

"Considering the level of embedded build cost inflation throughout the last two years coupled with significant interest rate increases, many of these customers would not otherwise be able to access new homes," the company said.

Cairn said build cost inflation was significant last year with the average cost of building their homes increasing by c. €20,000. "Inflation persisted into H2, albeit at more moderate levels. The cost of building new homes in Ireland, therefore, remains significantly elevated compared to two years ago with our build costs having increased by c. €35,000 per new home in this period."

The company said it enters 2023 with its largest-ever forward sales pipeline of more than 1,100 new homes. They said planning permission was in place for all their forecasted units for this year and they would be active on 20 developments this year.

Last year, Cairn Homes began work on eight new developments including new regional sites in Cork, Limerick and Kilkenny.