Construction worth €32bn in 2005, reports CSO

Construction output has risen by 80 per cent over the last five years and in 2005 was worth almost €32 billion, according to a report published by the Central Statistics Office today.

The Construction and Housing in Irelandreport found shows that 242,000 people, or one in every 12 persons in the workforce are employed in the sector. This is the highest level in the EU, where the average is 8 per cent.

This sector was also responsible for creating almost 30 per cent (76,000) of all new jobs in the five years to 2005, and 25,000 non-nationals now work on building sites. The average pay on building sites is €17.31 per hour, with workers spending on average two hours less on site per week, at 43.8 hours.

House building now accounts for 20 per cent of GDP.

Two-thirds of all output was in the residential sector, which was worth €20.9 billion in 2005. Investment in roads and other major capital projects was worth €4.3 billion last year. Social infrastructure investment was worth €3.5 billion.

Ireland's building boom is rapidly increasing the housing stock, which grew by 5 per cent last year. This is the highest rate of residential building in the EU.

Last year more than 86,000 houses and apartments were built, compared with less than 50,000 in 2000. This is four times the average rate of house building in other EU countries.

However, despite this increase in supply, the cost of residential property continues to accelerate.

According to the CSO in 2000, less than 5 per cent of new mortgages were for more than €200,000. Five years later, almost half (46.9 per cent) of all mortgages taken out exceed this value.

Over the five years to 2005 the average price of a new house in Ireland had spiralled from €166,000 to just over €272,000 in 2005.

The cost of apartments rose at a similar pace. In 2000 the average price of a new apartment was €206,000. Five years later it was €293,000.

The CSO says more than one-third of all dwellings sold last year cost in excess of €300,000.

The result of this frenetic borrowing activity has seen the value of mortgage debt accelerate to €100 billion last year. This is three times what was owed in 2000.

For average buyers, the cost of chasing these price rises means they have to borrow twice as much as was required in 2000. In 2005 the average size of a new mortgage was €200,000, almost double that of €102,000 five years earlier.

The average cost of a new house in 2005 was €386,000 in Dublin, €275,000 in Galway and €265,000 in Cork.

Aside from mortgage lenders and builders, the third beneficiary of the property boom is the Government. Last year the Exchequer pocketed more than €2 billion in stamp duty, a three-fold increase since 2002, with property contributing three-quarters of all stamp duty revenues.

Twenty-three people were killed on building sites last year.