New homes construction reaches seven-year high

Construction of new homes reached a seven-year high in January, as developers look to capitalise on the Government’s Help to Buy by increasing their output.

Latest figures from the Department of Housing show that based on electricity connections, some 1,244 units were completed across the country in January, up by 35 per cent year on year. On an annual basis, it means that 15,256 units were completed in the year to January, the highest level since 2010.

While the accuracy of these figures has been questioned, because they are based on ESB meter connection data, which may overcount the level of new builds, other figures also point to continued growth.

Strong recovery phase

“While question marks remain around the exact number of house completions in Ireland, the conclusions are the same no matter which dataset is used. The Irish housebuilding industry is in a strong recovery phase that has a number of years to go to catch up with underlying demand,” says Dermot O’Leary, chief economist with Goodbody Stockbrokers.

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Data from the department also points to strong growth in the number of new housing starts, with 910 units commenced in January, up by 45 per cent year on year. On an annual basis, some 13,334 commencement notices for new homes were submitted in the 12-month period to end January 2017, up by 44 per cent year on year. One-off houses are very much in the minority, with multiunit developments currently representing 69 per cent of all housing commencements, up from 60 per cent in 2015. Some 60 per cent of the commencements are in the greater Dublin region.

Goodbody also on Tuesday raised its guidance for 2017/2018 on Cairn Homes, developers of Parkside on the Malahide Road, and Albany in Killiney, due to its "unrivalled site ownership".

It owns about 20 per cent of undeveloped land in Dublin, and has been reporting strong sales, having pre-sold 301 units coming in to 2017.