Republic built 2,000 fewer new homes than official estimate

Official estimates exaggerated the number of new homes built in the Republic last year by more than 2,000, a new report claims.

A five-year slump in construction left the State facing a squeeze in the supply of new houses that drove sharp increases in property prices during 2014.

According to a report published on Wedneseday by DKM Economic Consultants and the Society of Chartered Surveyors Ireland (SCSI) the supply problems could be more serious than previously thought as the actual level of house building is below the number indicated by official figures.

SCSI incoming president, Andrew Nugent, pointed out that official figures show that 11,016 new homes were built in 2014.

“However, the commencement figures are far lower and this suggests to us that the actual level of housebuilding is actually lower than the completions figures suggest,” he said.

Mr Nugent explained that the official estimate of the number of new homes built last year is based number that connected for electricity for the first time.

He said the society believes that up to 20 per cent of the houses connected for electricity in 2014 had been built in previous years and had either been in receivership or owned by the National Asset Management Agency (Nama).

“On that basis, we believe that the actual number of new units built in 2014 was around 8,900 and that it will be around 10,000 in 2015 and 14,000 in 2016,” he said.

“This is significantly lower than other published projections and indicates that the new housing supply issue is even more serious than previously thought”.

The report, Irish Construction Prospects to 2016, says that the value of the Republic’s building industry grew 10 per cent in 2014 to €11 billion.