Dáil Éireann Debate, Thursday - 18 May 2023
150. Deputy Peadar Tóibín asked the Minister for Housing, Local Government and Heritage if his Department has undertaken a study to determine the impact building cost inflation is having on the construction of houses. [22656/23]
View answerConstruction costs have risen considerably over recent years. The CSO Wholesale Price Index shows a 12-month increase in price of construction materials of 13.5% to March 2023. The Building and Construction Index (i.e. Materials and Wages) fell by 0.1% in the month but rose by 8.5% in the 12 months to March 2023.
My Department actively monitors the housing market at all times. The impact of inflation and the uncertainties which arose as a result of Covid and then the war in Ukraine has had a real impact on housing output. This is reflected in the housing commencement figures which are published every month. My Department has also been working with all partners in dealing with the impact on inflation on social and affordable housing output to ensure that housing programmes continue to deliver.
Separately, in relation to the cost of construction more generally, on 4 May, I published the Residential Construction Cost Study report. The study found that overall construction costs using Irish specifications on a cost-per-square-metre rate for the same apartment building are broadly in line with construction costs in the four European comparator locations. A copy of the report can be accessed on my Department’s website at the following link: www.gov.ie/en/publication/2bf87-residential-construction-cost-study-report/
Housing for All and the Residential Construction Cost Study have recommended a series of actions related to modern methods of construction (MMC), standardisation and promoting MMC through public procurement which are aimed at reducing the cost of residential construction.
Government is working hard to implement these measures as priority actions, led by my Department and in collaboration with Government and Industry to help reduce the cost of construction.
