Momentum behind new home completion dips, CSO figures show

Meanwhile, a Purchasing Managers Index by BNP Paribas said supply chain delays were slightly worse in June than in the May.

ESRI researchers in the past estimated that 30,000 to 35,000 new homes a year were required to start meeting demand and help to keep house price and rental inflation in check.

The momentum behind new dwelling completions has slowed in the June quarter compared the same quarter a year ago, according to new Central Statistics Office (CSO) figures.

There were 7,353 new homes completed in Q2, a 3.5% drop on the same period a year ago.

However, completions recorded in Q2 last year were the highest in any quarter since the series began in 2011, up 53% on 2021, until Q4 in the same year which delivered 9,148 new dwellings.

This means the slight drop is from an all time high as government ramped up activity to meet demand amid a chronic housing shortage.

Research professor at the ESRI Kieran McQuinn said these results have "more to do with the high level of output in 2022", but also said "inflation rates have been quite persistent for key housing supply materials and labour so there is no doubt that that would impact supply levels at some stage".

The latest CSO figures also showed there was a year-on-year drop in completions in Dublin, where the housing crisis is the most pronounced, and around the border, mid-west, and south-west regions. But there was growth in the midlands, west, mid-east, and south-east regions.

The decline could be due to ongoing a reluctance to build apartments and ongoing supply chain issues.

The CSO showed apartment completions fell dramatically by almost 20% in this period, when separated from the overall figure.

A leading construction survey published earlier this month by BNP Paribas said said “viability remains challenging, particularly for apartments”.

The Purchasing Managers Index by BNP Paribas also said supply chain delays were slightly worse in June than in the May.

Meanwhile, there CSO said there was a 6.3% rise in seasonally adjusted new dwelling completions from in Q2 compared to the previous quarter.

The Economic Social and Research Institute researchers in the past estimated that 30,000 to 35,000 new homes a year were required to start meeting demand and help to keep house price and rental inflation in check.

BNP Paribas said it expects to deliver 30,000 completions this year.