House completions forecast 'to reach highest since banking crash at 35,000 units this year' 

Residential building activity picks up despite high borrowing costs, according to Goodbody

Housing starts have risen in recent months.

Irish house completions are set to reach 35,000 this year — the highest number since before the the banking and property crash more than 15 years ago — as residential building activity picks up despite high borrowing costs, Goodbody Analytics has predicted. 

Its new forecasts are based on the broker's estimates that almost 32,100 houses were built last year and come despite concerns that the building of new apartments and so-called scheme housing would fall off after the European Central Bank rapidly hiked interest rates last year.     

"Data on commencements is only available from 2014, but other data confirms that this is the highest level of residential construction in Ireland in the post-GFC (Global Financial Crisis) period," Goodbody chief economist Dermot O'Leary said in a commentary. "It suggests that completions remain on track to hit our forecast of circa 35k this year," he said. 

Among the top four locations for housebuilding, the Dublin region accounted for 42% of all commencements in the year to date, the Mid-East region for 17%, the South-West for 12%, and the South-East for 8% of all residential commencements, according to Goodbody estimates. 

At 13,000 units, apartment building commencements "defied expectations" that interest rates would slow activity, while house price inflation will run at 2.8% this year, it forecast.

Goodbody's new estimates suggest the Government is set to achieve its target to build 33,000 houses a year over a number of years under its Housing for All programme.  

However, the Economic and Social Research Institute, or ESRI, in a major review this month of the National Development Plan said that official housing targets will likely need to be revised higher based on the overall growth of the population and the number of Ukrainian refugees. 

The ESRI also reviewed official estimates of the number of skilled workers that will be required to build new homes.

Cairn Homes

Meanwhile, shares on Cairn Homes ended 4.5% higher on Tuesday after the housebuilder forecast "an exceptional" 2024. 

"Momentum is very strong entering the year with over 500 new homes due to close in the first three months of the year and 1,600 of our current forward sales pipeline expected to close in 2024," the builder said in an update. 

"Cairn is therefore poised to deliver an exceptional output and financial performance in 2024, and expects to deliver year-on-year turnover and profit growth of circa 30% and circa 2,200 new homes; operating profit of circa €145m; and 15% return on equity," it said.