100 new homes a week needed to solve crisis, say estate agents
IRELAND needs to build more than 100 homes a week for the next ten years to solve the housing crisis, a report claims.
While 86% of estate agents expect national property prices to increase by an average of 6% over the next 12 months, a similar number say the main reason for the increase is lack of supply.
Agents in Munster and Connacht/Ulster expect prices to increase by 7% over the next 12 months. The figure in Leinster
is 6% while in Dublin, where prices are highest, it is forecast at 4%.
The sharp rises are among the key findings of a survey of more than 200 estate agents by the Society of Chartered Surveyors of Ireland (SCSI) released yesterday.
Estate agents said the higher price forecast for properties outside Dublin was due to the Covid effect of a dramatic rise in the numbers of people working from home.
Yet, despite Covid, eight out of ten respondents reported an increase in enquiries and viewings over the past three months.
The SCSI/Central Bank of Ireland Residential Property
Price Survey is a threemonthly sentiment survey of SCSI members, consisting mainly of estate agents, auctioneers and surveyors.
SCSI president TJ Cronin the said lack of supply, construction lockdowns and steep increases in the cost of materials, meant prices would continue to rise.
‘We had a supply crisis preCovid and that has simply deepened due to Covid. While 45% of respondents in the survey reported a fall in selling instructions in the second quarter of 2021, 81% reported an increase in enquiries.
‘In addition, eight out of ten agents are reporting low stock levels. And that’s why so many agents were seeing a consistent increase in enquiries even during the worst of Covid.
‘While prospective sellers were reluctant to put their property on the market, buyers, who in many cases were in a position to increase their savings, were left chasing a reducing number of properties.
‘While it’s a sellers’ market right now, the rate of price increases we are seeing currently is not sustainable in the long term. Agents believe the only way to address the affordsions ability challenge is to increase housing supply.
‘Over the last 16 months the construction sector was closed down several times and the cumulative impact of the slowdown on new home construction will be with us until 2023 at least.
‘Increases in the price of steel, timber, plastic and insulation products – due to supply chain and transportation issues – and labour shortages across a number of trades will also lead to higher prices for new homes.’
Meanwhile, housing campaigner David Hall of the Irish Mortgage Holders Organisation said the forecasted price rises were down to a lack of supply, so developers with planning permission should use it and build straight away or risk it being withdrawn.
‘How are we going to resolve it? Simple, build more houses. We need to hire all the builders directly, declare a State of Emergency, lock everything down for three years, don’t give out any planning permisunless they’re for houses that people can start building straight away.
‘Any planning permission that is not utilised by the end of this year automatically expires. Use it or lose it.’
SCSI chief Shirley Coulter said the Covid pandemic had deepened the housing crisis and extraordinary measures were now needed.
‘We believe 400,000 new homes – social, affordable and private builds – will need to be built over the next ten years to meet pent-up demand and the needs of our growing population.
‘Current output is around 20,000 units, so a doubling of that will require a massive increase in funding and collaboration between the private and public sector. That is why we support the ESRI’s recent recommendation to Government to double its current investment in housing by borrowing between €4billion and €7billion a year while availing of low interest rates.
‘The ESRI estimates that if the state doubled its spend on housing from €2billion to €4billion it could deliver 18,000 units a year. That is what we need to help get us up to 40,000 units.’
‘Crisis deepened due to Covid’ ‘It’s simple. Build more houses’