Ireland needs between six and eight more stock market listed home builders if it is to meet the Government’s housing target of 300,000 homes by 2030, the chief executive of the Housing Agency has said.
“We have two PLCs [publicly listed companies] in Ireland. We probably need six. We probably need eight. That’s the reality of it,” Martin Whelan, the chief executive of the Housing Agency told The Irish Times in an interview.
“We need institutionally backed entities that can ride out the normal cycles in funding and in investment,” he said, noting the ability of major private home builders to “take a degree of risk and go in advance of the market” makes them core to solving the housing crisis.
At present, Cairn Homes and Glenveagh Homes are the only two property developers listed on the Irish stock market. Between them, they completed more than 1,600 new homes in the first six months of this year.
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He said the development sector faced challenges in attracting the capital needed to deliver at scale and stressed the importance of supporting Ireland’s “own domestic development platforms” to scale up to attract international investment.
The Government has committed to building more than 300,000 homes between 2025 and the end of 2030, representing an average of more than 50,000 each year.
The expectation is that housing output will increase incrementally year on year. The Economic and Social Research Institute (ESRI) has warned that housing output in 2025 is likely to reach 35,000, against the goal of 41,000 homes set under the Housing for All plan.
Mr Whelan said the State is “right to be ambitious in terms of numbers” noting that “if we are to move from 32,000 or 33,000 homes to 50,000, it will still be delivered through the same development sector so we have to support that sector to increase its capacity to deliver at scale”, he said.
To aid the development of those additional large-scale housing developers, Mr Whelan said the “the barriers to inward investment” need to be addressed, pointing to issues with the costs of building new homes.
“Not every entity will be, or should be, a PLC,” he said, “But you do want the entities that are capitalised, however that capitalisation happens, so that they can match their ambition with scaled delivery.”
