CIF Blog: 2018 Housing Forecast and Budget 2019 Recommendation

23 Jul 2018

There is no doubting that residential construction is currently in an expansionary phase. However, considering new dwelling completion data published by the CSO in June 2018, the CIF has now revised its forecast for the total number of new units to be completed in 2018.

CIF forecast that approximately 19,000 units will be completed by the end of 2018 (+30 per cent year on year).

The National Planning Framework’s National Policy Objective 32 targets the delivery of 550,000 additional households to 2040. A ‘Housing Need Demand Assessment’ will be undertaken for each local authority area to correlate and accurately align future housing requirements. Increasing urbanisation will also see the RMI market grow. The key drivers of the RMI market include the demand for energy efficiency in homes and increasing modification of use.


Source: CSO

Leading indicators help to forecast output levels in the sector and the new CSO completion data shows greater levels of convergence with the commencement data. According to the CSO’s new completion data, new completions increased by +45 per cent in 2017 to 14,446 new units.

Commenting on the CSO report, Kieran Culhane, Senior Statistician, CSO, said:

“The CSO’s New Dwelling Completions series for 2017 shows that the number of new dwellings was 4,825 below the number of ESB connections published by DHPLG. 57% of the difference is accounted for by reconnections, 23% by previously completed dwellings in unfinished housing developments and 20% by non-dwelling connections. Figures produced by others based on the Building Energy Rating (BER) data sets were acknowledged to underestimate the count as some self-build one-off houses do not get BERs.”

While the new completion data points to an even greater level of supply constraint in the market at present, other leading indicators such as planning permissions show positive intended increases in future supply. In the first quarter of 2018, planning permissions were granted for 8,405 dwelling units, compared with 4,650 units for the same period in 2017, an increase of 80.8 per cent. Quarter 1 2018 also saw the first permissions granted by An Bord Pleanála through Strategic Housing Development Applications, which accounted for 62 per cent of the quarterly increase in dwelling units.

Source: CSO

In summary, the leading indicators available to date show that:

  • 6,300 residential units were commenced during the 4 month period January to April 2018. The figures represent an increase of 15% (820 units) on the total number of units commenced during the same period in 2017. A total of 18,392 residential units were commenced in the rolling 12 month period to the end of April 2018. Individual/One Off housing units represent 24.7% of total commencements and increased by 5.8% on the same period in 2017.
  • 3,778 residential units were registered with HomeBond during the 5 month period January to May 2018. This figure is roughly similar to the figure for the same period in 2017. However, new registrations increased by 32.2% in the rolling 12 month period to the end of May 2018. It must also be noted that Global Home Warranties Ltd have registered 1,040 new registrations in the Republic of Ireland since the beginning of 2018. This data is not currently published on a monthly or county basis.
  • 3,256 residential units were completed during the 3 month period January to March 2018. The rate of completions represents a 26.9% increase in activity on the same period in 2017. 15,193 units were completed in the rolling 12 month period to the end of March 2018.

The 3,256 residential units completed during the first 3 months of 2018 can be broken down by type as follows:

The construction industry is making several recommendations in its Budget 2019 submission relating to housing, for example:

  • Extending the Help to Buy Incentive Scheme beyond the 31st December 2019 to retain the added certainty it provides in the residential construction industry.
  • Section 61 of the Finance Act 2017 increased the rate of stamp duty from 2% to 6% on all commercial transactions including the acquisition of residentially zoned land but allows for a refund of two thirds of the stamp duty (4%) paid on acquisition of residential land provided the Commencement Notice is lodged within 30 months of the execution of the Instrument or 31 December 2021. CIF recommends amending the period to 60 months and 31 December 2024 in Budget 2019 as residentially zoned lands which are not serviced with water supply are currently being purchased with the expectation that the water services will be in place in circa three to four years. This means that the 30 month period/31 December 2021 date for lodgement of a Commencement Notice cannot be adhered to in order to recoup the additional 4% stamp duty paid.


The CIF Budgetary recommendations are reasonable and are intended to maintain the current expansionary phase in the residential construction sector so that the targets set out in the National Planning Framework, ‘Project Ireland 2040’, are both feasible and deliverable.

Jeanette Mair, Economic and Policy Research Executive, CIF

Join the Construction Industry Federation