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Pace of housing starts growth slumps

Monday, August 11 10:34:26

A study out today shows a 66pc rise in new housing starts in the first half of the year compared to the same time a year ago.

This increase, however, is tempered by the fact that there has been a massive drop in the rate of growth in the last few months.

The index, from Link2Plans, also showed that the number of planning applications is up 19pc when compared to the same period in 2013.

Project commencements for the first six months of 2014 have halved when compared to the figures published for January to April of 2014, when project commencements were up year on year at 132pc.

A rush to get residential construction projects started before new building regulations came into force on 1 March 2014 was the main factor behind the remarkable increases in project commencements in the first few months of 2014.

The data contained in the National Housing Construction Index is aggregated by consultancy Link2Plans from real time planning and project information in every local authority area.

According to Danny O'Shea Managing Director of Link2Plans, "The year on year increases for planning applications and project commencements bodes well for the construction sector in the short to medium term. The +66pc year on year increase in project commencements is incredibly positive, notwithstanding the slowdown in the rate of growth in project commencements since the start of the year. Also, the increase in project commencements has been felt across the whole country, with every county recording a rise except for Roscommon which showed no change."

Referring to the recent Research Note published by the ESRI that concluded that 90,000 additional housing units will be required to be built across the country between 2011 and 2021, Danny O'Shea, Managing Director of Link2Plans said that "The figures for planning applications and project commencements are extremely positive. They are still relatively modest in the overall context of the level of construction activity required to meet the recent ESRI forecasts for housing requirements. Based on the current level of building activity, there would be a significant shortfall in the estimated 90,000 units required."

The largest increases in project commencements were in Westmeath (+189pc), Monaghan (+138pc), Sligo (+114pc), Cork (+112pc), Meath (+98pc), Mayo (+95pc) and Waterford (+91pc) with the lowest increases in project commencements taking place in Roscommon (+0pc), Cavan (+17pc), Wicklow (+18pc), Louth (+19pc), Longford (+26pc), and Leitrim (+27pc).

Dublin was the best performing county for new planning applications, with an increase of +63pc when compared to the same period in 2013, and continues the upward trend for Dublin which started in the middle of 2013.

Danny O'Shea Managing Director of Link2Plans "the upward trend in the number of planning applications that started at the beginning of 2014 shows no signs of slowing down and is evidence of level of confidence returning to the construction sector. Over half the counties recorded an increase in planning applications with Dublin again recording the biggest gain with an increase of +63pc. Other counties which recorded substantial increases in the number of planning applications were Waterford (+59pc), Wicklow (+46pc), Meath (+40pc) and Kerry (+32pc). The largest falls in planning applications occurred in Leitrim (-37pc), Laois (-16pc), Donegal (-16pc), Cork (-11pc), Carlow (-10pc) and Kilkenny (-8pc)."

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