Des Donnelly
New homes director at Hooke & MacDonald
Demand for new homes in Ireland by owner-occupiers is at an all-time high, with first-time buyers accounting for a large proportion of this. The population is growing and our economy continues to perform strongly. But while the supply of housing is increasing steadily, it’s yet to grow at a pace that’s sufficient to meet the Government’s targets or the needs of homebuyers.
First-time buyers remain the key cohort when it comes to the demand for new homes, and they continue to be supported in this by both the Help to Buy and First Home schemes. In the case of Help to Buy though, the €500,000 price threshold is now 10 years old and pitched at too low a level to be of benefit to those looking to buy in Dublin and its commuter belt. The price threshold now needs to be increased if it is to keep pace with build costs and inflation.
The ongoing conflict in the Middle East is adding to construction costs and having a knock-on effect on the supply of new homes as developers are forced to constantly reassess the level of risk to their projects. Regulatory costs are also mounting up, putting pressure on house prices and reducing delivery viability, especially for higher-density development. These costs include the imposition of the concrete levy, the payment of carbon tax, the increase in Part V social and affordable housing provision to 20 per cent and the payment of the water levy.
The building industry has been playing its part in increasing supply through the acquisition by developers of new sites, where available, and through seeking planning permission in a difficult regulatory environment. Large sites are being developed on at speed, and the homes being built on them are of superb quality. All of this is happening against an ongoing backdrop of insufficient zoned land, infrastructure deficiencies and planning delays.
Separately, both the affordable purchase and Croí Cónaithe (Cities) schemes are proving to be very successful. Apartment living is increasing in popularity as a result.