51% fall in house building from 2014

There has been a sharp nationwide decline in activity in the residential construction sector, but the overall trend remains positive.

51% fall in house building from 2014

Figures from the National Housing Construction Index released yesterday show despite a 51% decline in the number of project commencements between January and April this year, compared to the same period last year, activity levels are still above 2013 figures.

The index also shows planning applications are up by almost 20% in the same period, with double-digit growth recorded in 23 counties.

When the data is combined, the forecast for the medium term is positive, consultancy Link2Plans said as it released its latest analysis on the National Housing Construction Index.

The index gathers information from real-time planning and project information in every local authority area, and Link2Plans tracked every project from January to April, and compared it with the same period in 2014.

The data shows that the number of residential project commencements plunged by 1,744 or 51% — from 3,472 to 1,698 — when compared with the same period in 2014, with every county experiencing a decline.

The largest declines were in Donegal, Clare and Westmeath, with declines of over 70%, with declines of over 50% in Cork, Galway, Wexford, Limerick and Laois.

The smallest year-on-year decrease occurred in Waterford (-13%), Dublin (-22%), Cavan (-34%), Carlow (-36%) and Wicklow (-37%).

However, planning applications in the period are up 18% nationally — from 3,889 to 4602 — with Leitrim up 64%, Louth up 61% and Laois up 51%, recording the biggest gains.

Cavan (+52%), Sligo (+51%), Kerry (+51%) and Meath (+48%) also returned significant increases while, planning applications were down in just two counties — in Limerick by 3% and Dublin by 1%.

Link2Plans managing director Danny O’Shea said he believes the introduction of new building regulations in March 2014 was behind a surge in residential construction activity last year, and that the period was “very much an outlier”.

“These one-off changes in the sector created a major injection in construction activity for that period,” he said.

“When compared to previous years, such as 2013, we do see growth in the construction sector, with the first four months of 2015 showing an increase of 11% when compared to the same period in 2013.

“When these figures are combined with the strong growth in planning applications, which have recorded increases for the past 18 months, the forecast for the medium term remains positive.”

Mr O’Shea said their research also shows that it took an average of 142 weeks for residential developments to get from the planning application stage to commencement of work on site. And for one-off houses, the research from the first four months of this year shows the average time from planning to starting work was 61 weeks.

Link2Plans produce the index every two months, providing a barometer of real time sentiment as evidenced by planning applications, and actual residential construction activity.


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