12 hours ago
Development land sales sink to lowest in more than two years
The
sale of land for development
in the
Greater Dublin Area
and the regional centres of
Cork
,
Galway
and
Limerick
sank to its lowest level in more than two years in the second quarter, a new report from Ireland's largest estate agent says.
Sherry FitzGerald's
report on activity on the sale of development land during the first half of this year shows the second quarter was significantly quieter than the previous three-month period, with spend totalling about €111 million.
That figure covers a total of 17 transactions, which was the lowest number seen since the first quarter of 2023.
On top of that, the value of the land transacted was only about half that which changed hands during the same period last year.
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However, when combined with what was robust activity in the opening quarter, turnover for the first six months totalled €372 million, which was greater than the long-term average of €328 million, but also 15 per cent below last year.
The report, authored by the company's head of research Jean Behan, suggested policies recently announced by the Government to address the housing crisis are likely to have 'delayed decision-making' among stakeholders, thereby 'stemming transaction activity'.
'It is important to note that the relatively quieter performance during quarter two coincided with the announcement of numerous Government policies aimed at increasing the supply of new homes,' the report said.
Greater policy clarity going forward 'should help restore market confidence' and result in stronger transaction activity as the year progresses, it added.
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The report said delays in the planning system have contributed to declining forward investment. Photograph: Paul Brown/ Getty Images
The report also gave something of a cool welcome to the Government's recently announced plan to ramp up infrastructure spend across the State as it seeks to address an issue that has emerged as a key thorn in efforts to tackle the housing crisis.
'There is still a lot of detail urgently needed as to how Government agencies responsible for delivering these projects will be resourced and regarding timelines for delivery,' it said.
'The impact of the lack of investment in our national infrastructure is having a negative effect on housing delivery, with recent reports of delays to commencement of residential projects due to lack of capacity for water and power connections.
'This highlights the urgent need for clear and concise planning of infrastructure project delivery in a reasonable time frame to generate confidence from international investors and achieve the new housing targets.'
The report said delays in the planning system have contributed to declining forward investment, which has led to 'severely curtailed' supply of new homes and reduced transaction activity in the development land market.
The report acknowledged recent measures to make the planning system more efficient, but insisted 'adequate infrastructure' to support residential development remains a 'key supply side impediment'.
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All that being said, the State remained an 'active player' in the market during the second quarter, accounting for a number of large transactions, including two acquisitions by the Land Development Agency.
The first comprised the purchase of approximately 40 acres of land with a capacity to deliver 350 homes in Lehaunstown, Dublin 18, while the second involved 9.8 acres of land in Cookstown, Tallaght, with a potential to deliver over 700 new homes.
The Health Service Executive (HSE) purchased 16 acres of land in Seatown, Swords, for the development of a new primary care facility for approximately €20 million.
Another notable transaction involved the sale of 19.2 acres of residential zoned land at Stephenstown, Balbriggan with a potential capacity for 322 units for in excess of €15 million.
Outside of the capital, the most significant transaction to take place comprised the sale of 13 acres at Naas Racecourse, zoned for residential use, to Ballymore Properties, for approximately €7.8 million.
