Hooke & McDonald urges change in planning policies

Estate agent Hooke & McDonald has estimated that there is only enough land in Dublin's city centre for another six years' housing supply, based on current planning policies.

In its latest property outlook, it called for the relaxation of restrictions on building height so as to intensify the use of land in key urban areas.

Current planning policies, particularly in Dublin, were contributing to urban sprawl, it said.

The estate agent said that the Irish residential property market was on course for a period of sustained growth that would last for the foreseeable future. "It is soundly based, driven by the record levels of employment creation, the thriving economy, and the consequent population expansion."

The shortfall between demand and supply was also boosting prices.

The property agent said that demand for new homes nationwide would increase from 92,000 units this year to 101,000 in 2008. "Supply is failing to meet the required demand, even though an estimated 85,000 new homes are to be built throughout the State in 2006, rising to 90,000 in 2008.

"A serious supply crisis is developing in Dublin caused by planning difficulties at local authority and An Bord Pleanála levels," it said. The company said Cork was set for a period of rapid expansion, with 10,000 new homes to be built in the city and county this year.

The estate agent said it believed home ownership was still within reach for the vast majority of young people.

However, with interest rates to rise to at least 3 per cent by the end of this year, affordability will tighten as rates and prices increase.

"This is not expected to significantly impact on overall demand in the market."

It said residential rents in Dublin were set to rise by 5 per cent this year, followed by 6 per cent in 2007.