More construction – but fall off in residential applications

While the latest building figures, published this week, show a strong (44 per cent) increase in the value of construction projects started in the first six months of the year compared with the same period last year, the same figures noted a substantial fall-off in residential applications for planning permission.

The Building Information Index reflected a 15 per cent fall-off in the combined value of residential schemes from €4.46 billion in the first half of 2015 to €3.81billion in the first half of 2016. Construction commencements rose in almost every region except in Leinster.

In addition, residential construction projects continue to be the slowest to get from the planning stage to work starting on site. They take an average of 137 weeks (more than two-and-a-half years) compared with a general construction project average of 77 weeks.

Danny O’Shea, managing director of Building Information Ireland, said: “The first half of 2016 has seen a slight fall in the average number of weeks it takes for a construction project to get from planning application to work commencing on site when compared with the first half of 2015. While the length of time in most cases is extremely long, the slight improvement can be seen as a further sign of improving sentiment in the construction sector.”

Fair play to Danny for taking a glass-is-half-full approach, but given the dire shortage of new residential units, surely things need to speed up a bit more. The Minister for Housing has already stated his intention to fast-track planning for 100+ unit housing schemes in zoned areas, by bypassing the local authorities and going straight through An Bord Pleanála. However the idea has been met with a tepid response from industry insiders. They argue it will make it more difficult for the public to raise objections and it removes the opportunity for developers to engage with local authorities around key issues such as roads and infrastructure. But any effort to address the existing tortuously protracted application and appeals process has to be welcomed.