Enda says we need 25,000 new homes a year to meet the demand

ENDA Kenny has said 25,000 new homes need to be built every year to meet growing demand.

But construction industry sources estimate we are ‘years away’ from reaching this goal and say that 10,000 new homes is a much more realistic target for 2014.

The Taoiseach revealed that the Government plans to help the industry meet the increasing demand for family homes and expects to see a ‘serious improvement’ in the construction sector in 2014.

Mr Kenny said in Government Buildings yesterday: ‘Quite a number of competent smaller contractors who have

‘Construction in the capital must triple’

never been involved in the Nama business intend on getting in on building houses. There is a need for 20,000 to 25,000 houses a year.’

He added that there needed to be a facility for builders to ‘access credit, to develop sites, build the houses and have a stream of income coming through’.

A spokesman for the Construction Industry Federation said: ‘We agree that there should be about 25,000 houses built every year but we are probably at least a few years away from achieving that.

‘Next year we are probably more likely to be in the region of 10,000 units, tops.’

There is a huge lack of family housing in Dublin at the moment which some analysts claim is creating a property bubble and pushing up the price of property.

Economist John FitzGerald of the Economic and Social Research Institute, recently estimated that construction in the capital needed to triple to meet demand.

The CIF said the cost of building and the time it took to get planning permission were some of the factors holding the industry back from supplying these new properties.

‘The average cost to build a three bedroom semi-detached house is €197,000,’ the spokesman said, adding that developers are required to set 20% of the houses they build aside for social housing, which increased the cost.

‘We have already called on the Government to reassess this because it’s a barrier to building,’ he said.

The CIF has called for a new system that would speed up the planning process.

‘In Dublin there’s planning permission for 30,000 housing units. However, 21,000 of those are for apartments. But what the market wants really is housing and the problem is, if you were to try change that planning permission, you have to go through the whole process again, which takes months,’ he said.

‘The quickest way to get people off dole’

The CIF is not keen on a recent proposal by Labour to introduce a levy on vacant development sites. The idea was mooted by Dublin mayor Oisín Quinn, in conjunction with Dublin City Council’s planning division. It is backed by Labour’s Junior Housing Minister Jan O’Sullivan along with Labour backbenchers.

The plans would see a tax of 10% imposed on derelict sites to discourage land hoarding in the capital’s city centre.

The CIF argued that this levy could put struggling developers under more financial pressure and send the wrong message to investors.

‘The quickest way to get people back working is to stimulate the construction sector, because one in four people on the dole are former construction workers.’

CIF director general Tom Parlon has said such a plan would send out a ‘very wrong message’ to investors.

Mr Kenny said there would be a special Cabinet meeting on jobs early in the new year. He announced further plans on the opening of 31 new Local Enterprise Offices around the country in 2014.