‘No delay’ in social and affordable housing over rise in construction costs

The Minister for Housing said there will be no delay in building social and affordable housing due to the ongoing rise in construction costs.

Darragh O’Brien said the rise in inflation and material costs has been slowing down, while supply chains “have improved”.

A report from the Banking and Payments Federation Ireland (BPFI) stated that the increase of new homes has eased the growth of housing prices, but it could be off-set by the rise in construction materials.

There are concerns that rising building costs will lead to missed Housing for All targets for the year.

Annual inflation for building and construction materials was at 18.2% in April.

Mr O’Brien said the report from the BPFI was based on the first quarter of the year before the Government approved the scheme to pay up to 70% of builders’ inflation-related construction costs, which was introduced last month.

He said the scheme has been well received by the construction sector.

“That will ensure there will be no delay in so far as the delivery of social housing stock or affordable housing stock we are working through,” Mr O’Brien added.

“Everyone knows the inflation issues we are grappling with in Ireland is not unique to us.

“It is due to the war in Ukraine.

“Thankfully we have seen that slowing down somewhat, the inflation and material cost.

“The supply chains have improved as well.

“We are targeting this year 24,600 new builds which will be substantially more on last year when just 20,000 (were completed).”

Asked whether there are any further Government plans to mitigate the costs of buildings materials, the Fianna Fail minister said it will require Government approval.

“There are many small builders and others who are actually engaged in social housing and affordable housing schemes right across the country,” he added.

“So the burden sharing that we brought brought in, which has been broadly welcomed by the sector, will help greatly in that space.

“Any other measures that we would take into the future, on any issue, be that housing, education or childcare would be a matter for government decide as a collective.

“We need to get this scheme bedded down now, and I think it will help greatly.

“What I’m really focused on is delivering more social homes this year than we’ve ever done in the history of the state and we’re on track to do that, to deliver affordable homes at scale for the first time in nearly 15 years.

“To deliver more cost rental, which are affordable rental for working people that didn’t exist 12 months ago.

“So we’re making progress in that space but obviously there are challenges and further challenges will arise.”

Mr O’Brien made the comments as he officially opened 21 one-bedroom facility, purpose built for seniors and people with a disability in Ballinteer in south Dublin.

Despite the scheme being approved in 2015, it took seven years to complete.

Mr O’Brien said there are learnings to be made from the scheme, saying it took too long to complete.

“We’ve improved the approval process within our department to a one-stage approval process for schemes under six million, which literally means it doesn’t have to go back and forth, back and forth between the department and local authorities,” he added.

He also stated that the homes of the elderly residents who have moved into the facility will be freed up and become available to the Dun Laoghaire housing stock.