The director of the Irish Home Builders' Association (IHBA), Ciaran Ryan, says that current uncertainty in the market is making lending institutions nervous.

Sites in Dublin fell by anything from 10 to 20 per cent in value over the year 2000. According to the IAVI property survey 2000, the outlook for commercial land is more positive - commercial sites saw a 14 to 16 per cent increase nationally last year.

Another factor fuelling current uncertainty is the necessity to hand over 20 per cent of sites for social and affordable housing.

Developers are even more preoccupied by the decision to reduce the life of residential planning permission from five to two years. This will invariably mean that companies involved in large schemes will have to reapply periodically for planning permission.

The IHBA say that new planning applications in some areas are "lower than the level that would be expected, as developments are scaled down to a level that can meet the new rules. In Dublin city, only one application in excess of 200 apartments was lodged in the period from 25th August 1999 to 31st October 2000. Only six applications were lodged for schemes of over 100 apartments." Referring to the threat - since removed - to increase the capital gains tax rate to 60 per cent in 2002, the Department of the Environment and Local Government stated, "it is widely acknowledged as having been particularly effective in bringing forward large tracts of land for residential development . . . there is also evidence that the provisions of Part V of the Planning and Development Act are having the effect of pushing down land prices."