Housing construction activity rose sharply in the first four months of the year, but more workers may be needed for the delivery of units, according to the latest housing market monitor from the Banking & Payments Federation Ireland (BPFI).
A total of 30,138 housing units commenced in the January to April period, marking a substantial jump in activity compared to 2023, when there was a total of 32,800 commenced for the entire year.
However, despite this “robust” level of activity there was a decline of 12.1 per cent in housing completions in the first four months of 2024 compared with the same period in 2023, with the decrease driven by a fall in apartment completions.
Some 42 per cent of housing commencements in the first four months of 2024 were for apartments, where there is typically a longer lag between overall commencements and completions.
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“Today’s report shows that while there has been a 12.1 per cent decline in housing completions in the first quarter of 2024 compared to the same period in 2023, mainly driven by the fall in the level of apartment completions, we are seeing evidence of increased construction activity with just over 53,000 units commenced in the 12 months to the end of April 2024,” said BPFI chief executive Brian Hayes.
There were 18,000 housing units commenced in April 2024 he said. This was possibly due in part to the expected end of the waiver on development contributions and rebates on water charges, which were subsequently extended in May to the end of this year for qualifying housing works completed by the end of 2026.
“While commencement activity is strong, increased labour capacity may be required to deliver housing in line with commencement activity,” Mr Hayes said.
[ Construction activity steady but housing still on upward curveOpens in new window ]
“However, indications are somewhat positive, with employment in the construction sector having increased from 147,500 in the first quarter of 2020 to 171,700 in the first quarter of 2024 and it is likely that some of the skilled labour required for this increased level of output could be transferred from other parts of the construction sector, such as office construction, where activity seems to be decreasing.”
Declining inflation rates are “contributing to a more positive outlook” for disposable incomes, Mr Hayes said, and along with a growing population and Government supports for prospective first-time buyers, this is likely to sustain high levels of demand for housing.
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