The difficulties for small housebuilders to secure finance outside of Dublin could “derail” the Government’s housing strategy, the Cork branch of the Construction Industry Federation (CIF) has said, writes Pádraig Hoare.
The branch called for a small builders’ fund to be set up, saying “a balanced regional economy” is not possible if small housebuilders “cannot access finance outside Dublin”. Cork CIF said the fund, as well as an increase in the infrastructure fund, would “enable regional builders to deliver the essential housing and infrastructure required” to deliver targets in the Government’s jobs, regional development, housing and FDI strategies.
CIF regional director, Conor O’Connell said: “As it becomes viable to build houses outside the urban centres, small builders will not be in position to secure finance. Traditional sources of finance such as the banks are not able to lend to these regional SMEs, often third-generation family businesses, to deliver the relatively small housing projects required to replenish the stock of towns outside the greater Dublin region.”
He said: “How can we build a balanced regional economy if small housebuilders cannot access finance? This issue has the potential to derail the Government’s housing strategy and its ambitions for regional development.”
The fund would only apply to builders where there is real demand and traditional sources of finance are not available. The CIF is calling for a review of construction costs, suggesting local property tax replace development levies, and a temporary Vat rate of 9%.
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