78,000 Housing Completions Last Year
What crisis? The construction sector completed over 78,000 residences last year which is a little above analyst expectation but below the 2006 figure of 90,000+. So are we all over-egging this a bit?
For me there are still some very concrete reasons to think that reliance on concrete to fuel GDP is a dangerous policy. Firstly there are still over 40,000 empty residences in Dublin alone. This won’t come as a shock to Conor‘s readers but it is a vital statistic. Supply is very much out there. Houses are there to be filled. Yet the market is moving very slowly and prices are dropping like stones. The demand issue will not be going away any time soon. We are in a period of credit tightening not just in terms of interest rates but in terms of bank’s ability and willingness to give out loans. Money keeps a consumer market going and this one is dry of cash.
The ESRI were bang on the money in September with their 78,000 completion prediction and they suggest that a mid 60,000 figure of completions will be seen in 2008. Yet they reckon it might be overly optimistic and the CIF reckon it could be as low as 45,000 completions. That is more sensible considering the level of supply out there and the slow movement of properties. So the completions are not exactly bad news and may well provide grist to the mill of those who suggest we are talking this market down. Yet there is a big drop to come and a lot of unmoved stock out there. Pain is likely to be more acute this year than last.