Signs of strong rebound in building activity

 

Just under 19,000 residential buildings were under construction across the country in June of this year, according to the latest GeoView Residential Buildings Report compiled by EY Economic Advisory for GeoDirectory.

GeoDirectory - a joint venture between An Post and Ordnance Survey Ireland - is Ireland's official complete database of commercial and residential buildings.

The total of 18,911 buildings that were under active construction in June represents a year-on-year increase of over 38%. It suggests that residential construction activity has rebounded strongly since Covid-19 restrictions on the sector were lifted in April.

Construction activity resumed in May of 2020 having been closed for seven weeks after the initial onset of Covid-19 here. That period of closure would have severely dampened activity captured in last year's report.

However, all but essential construction projects were closed from January to mid-April this year when building resumed once again on a phased basis.

Over half - 58.4% - of the residential buildings under construction in Ireland in June were located in the Leinster region. The Greater Dublin Area of Dublin, Meath, Kildare and Wicklow accounted for just over a third of the total.

The lowest levels of construction activity were recorded in Ulster (6.5%) and Connacht (10.6%).

Over 25,500 new residential addresses were added to GeoDirectory's nationwide database in the 12 months to June which was an increase of 53.5% on the previous June.

In percentage terms, the highest year-on-year growth in new address points was in Leitrim, where growth of almost 220% was recorded, followed by Carlow at 146.5%.

The report also found that almost 10% of all residential stock in the state consists of apartments. About tw-thirds of the apartments are located in Dublin, where over one in five homes is now an apartment.

The figures show that there were 92,135 vacant residential properties in the State in June, resulting in a national average vacancy rate of 4.5% - unchanged on last year.

16 of the 26 counties recorded a decline in residential vacancy rates in the year. Dublin had the lowest vacancy rate in the country at 1.6% - which represented a very marginal increase of 0.3 percentage points on last year.

Leitrim had the highest vacancy rate at 14.8%, followed by Roscommon at 12.3% and Mayo at 12%.

"Our data shows that residential construction activity has responded well since Covid-19 restrictions for the sector were lifted in April. There were over 5,000 more residential buildings under construction last month than there was in June 2020," Dara Keogh, CEO of GeoDirectory said. "This is still short of the levels of stock needed to ease demand, but the data trends suggest that things are moving in the right direction."

The number of residential property transactions fell by 6.5% in the year to May 2021, according to the report. 39,526 residential property transactions took place in the 12 month period, of which around 18% were for new dwellings.

The average residential property price in Ireland across this time period was €306,641 with Dublin the highest at just over €470,000. Longford had the lowest average price in the country at just under €130,000.

"Despite a positive outlook regarding the pipeline of new builds, the level of residential property transactions is still some way short of pre-Covid levels," Annette Hughes, Director at EY Economic Advisory, said.

"There are a number of reasons for this, including travel limits, restrictions around viewings and people holding off on moving or selling their house," she added.