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Research:
Research
18 Apr 2023
4 minute read

Responding to Ireland's housing requirements

FinSight | Future Focus

Housing remains one of the key social, economic, and political issues in Ireland – as well as one of the most complex. But can it be solved?
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When considering the current Irish housing market as a whole, simple economics comes to mind – demand and supply dynamics. But the intricacies within this market make it increasingly complicated to understand, and progressively challenging for both developers and buyers to navigate.


In this edition of our FinSight | Future Focus video series, John Doddy, Partner and Head of Debt & Capital Advisory, and Kate English, Director and Head of Real Estate Research, assess housing in Ireland across three key areas – current supply and demand, gaps across planning, funding, and viability, and potential ways to address these gaps – before sharing their insight on how simplification may be the solution to this thorny problem.
 

Our video was filmed in March 2023.

Viability

Viability is a real challenge. We see costs continue to rise, alongside interest rates also which are pushing out yields. This narrows down equity and makes schemes unviable.

Planning

A lot of the schemes that are in judicial review are no longer viable because the planning was applied for under different assumptions than what are prevalent in the market at the moment. This makes the number of units that are tied up in planning misleading – and affects the appetite of equity to come in.

Funding

The change in the yield environment and the rise in costs has resulted in a change in investor sentiment – which could affect the level of activity from institutional investors and result in a lack of capital in the market from a cohort that has been responsible for much development in recent years.

State intervention

The state must intervene in a meaningful way to reduce both risk and cost. This should be done at the infrastructure level, through bodies like HISCo, at the sales risk level, through bodies like the LDA, and through direct intervention into the costs of building higher density through bodies like Croí Cónaithe.

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Get in touch

John Doddy

Partner | Head of Debt & Capital Advisory
+353 1 417 2594

Kate English

Director, Head of Real Estate Research, Financial Advisory
+353 1 417 1385

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