Increases in property prices continue to illustrate lack of supply

Thursday 24th July 2014 The Society of Chartered Surveyors Ireland has called for the prompt implementation of the measures recommended in the Government’s Construction 2020 Strategy to address the current housing supply shortage and pace of increases in property prices.

The SCSI, the professional body for the property and construction sector, made the call following the publication of the latest CSO Property Price Index results for June which showed an increase of 12.5% in average property prices in the year to June 2014.Conor O’Donovan, Policy Director of the SCSI, said “Average property prices have increased by almost a quarter since this time last year in Dublin and while property values still remain approximately 45% lower than in 2007, the current rate of price inflation is of significant concern and poses a challenge to levels of affordability and our economic competitiveness.

The key issue appears to be the shortage of supply of new properties. Last year we built just 8,301 new houses when we should be building up to 25,000 pa to meet demand. Clearly the pendulum has swung too far in Ireland and we now need a more balanced approach to building houses to meet the needs of our population and economy.

In May, Government published Construction 2020 – A Strategy for a Renewed Construction Sector and some of the measures recommended in Construction 2020 including a more flexible approach to the planning process, ensuring development on vacant sites which are idle, streamlining the Strategic Development Zone (SDZ) process and removing other obstacles to development need to be implemented to try to improve the current housing supply shortages”, he concluded.