It will take at least 2 – 3 years for the construction industry to meet the demand for housing that is developing in the Dublin market, according to the CIF. The CIF were commenting after the CSO reported another increase in house prices in Dublin.
According to the CSO’s latest Residential Property Price Index, Dublin house prices have risen by 14.6% compared to the same period last year. This followed a 2% price growth in October. Dublin apartment prices are also up, growing by 18% compared to the same period in 2012.
Property experts have attributed the increase in prices to demand outstripping supply in the Dublin region. Despite the increased demand there has been little change in the level of house building activity taking place.
997 housing units have been completed in Dublin in the first 10 months of 2013, only 92 units more than the same period in 2012. While work started on 750 units in Dublin in the first 9 months of 2013, an increase of 227 units on the same period in 2012.
“While we have seen a small increase in residential building activity in Dublin in recent months, unfortunately it is nowhere near a level that would satisfy the current market demands,” said CIF Director of Housing, Hubert Fitzpatrick. “Based on the current demand for housing, we would need to see four times as many houses being built in Dublin on an annual basis.
“When you also add in the continuing growth of population in Dublin and the changing demographic needs then we estimate we are at least 2 -3 years away from producing that level of new housing. With rent costs continuing to rise there is also an increased appetite for moving towards buying property.
“There is still not a strong level of new building taking place in Dublin. This is due to difficulties securing finance, the high cost of building and the restrictive nature of the planning regime. To achieve the required increase in completion levels factors such as density, Part V social and affordable housing obligations and development finance must be addressed.
“The delay in bringing forward more housing developments in Dublin will obviously continue to have implications for the housing market and we would expect to see further price increases in Dublin next year,” Mr. Fitzpatrick concluded.