Skills shortage is the next industry crisis to be dealt with
When Sean Mulryan speaks, we listen.
“Radical new thinking, a sense of urgency, and joined-up thinking are essential in solving the housing crisis.”
As founder of the Ballymore Group, he does not speak to the media on a regular basis so when he does, we can be sure that it’s because he has something important to say. Tom Lyons, writing in The Sunday Business Post today, carries the Ballymore chief’s warning that the now-severe skills shortage within the construction industry will prevent the state of building the volume of homes necessary to solve the current housing crisis. This problem is felt more in the greater Dublin area where demand is high.
In this interview, Sean Mulryan refers to “chronic” shortage of apprentices and skilled tradespeople and this is something that has been the subject of an ongoing campaign by the Construction Industry Federation (CIF) over recent years. It is estimated that the industry needs between 76,000 to 112,000 new, skilled workers in order to deliver the volume of homes promised by the state by the year 2021.
This is a big problem but there are a number of different industry organisations working on this, all coming from different angles. For example, Solas has a major push on apprenticeships [did you know that the average age of someone starting an apprenticeship has jumped from 16 to 24 over the past decade and a half?]; CIF are championing #BuildingEquality to attract and retain women in the industry; the engineering bodies are appealing to returning recent emigrants – according to state figures, up to 400 Irish emigrants are returning home every week!
So, the message is that the planning, construction and property industries are attractive career options once again but we need to take a multi-pronged approach across age and gender, starting with primary school education.
In relation to the cost of development, he calls on the state to make publicly owned lands under state control accessible for housing. “Selling public land to international funds which have no experience of housing development does not make sense and is an example of the lack of joined-up thinking. This short-term thinking must stop and the government must work with established Irish developers and builders to deliver housing in the quantity needed.”
“The new regulations in 2017 were introduced, it seems, with no regard for costs for first-time buyers, and have resulted in increasing the size of the three-bed semi starter home and adding approximately €28,000 to the cost of such homes, which equates to 25% increase in building costs.”
On the market
- Hooke & MacDonald have firmly re-established themselves as the masters of new homes, with houses and apartments right across Dublin north and south, Meath and Kildare from €240,000 in Dublin.
- Similarly, Knight Frank have started the traditional selling season by launching some amazing Dublin red brick executive homes, from Dalkey to Ballsbridge (€2.5m upwards).
Other property-related news
- Up to 50,000 homes could be built on sites recently acquired from Nama, primarily by vulture funds according to reporter Jack Horgan-Jones. An estimated 90% of the lands/sites sold by the state agency over the past eight years are lying idle, with Cork sites showing the highest rate of non-use at 99.3% while Dublin sites are 87.4% idle.
- The State is set to follow through on threats over the past decade to reduce one-off housing in rural areas by getting people to build on serviced sites in towns and villages instead – the consultation period is still open so log on to http://npf.ie/ for more details and to submit your opinion/comments on the National Planning Framework (NPF).
- CIF president Dominic Doheny calls for a scheme to support “small developers” so that they can compete with Cairn and other prolific developers without paying exorbitant rates to access much-needed development finance.
- Irish insulation and building materials company Kingspan is expanding its US manufacturing facility in Virginia by $25 million.
- Stephen Kinsella writes in favour of proper use of our property tax (LPT) take: “We are hypocrites if we donate €20 to a homelessness charity and hunt for a property tax cut. Dublin already pays less than people in Longford, Galway and more than 20 other councils.”
- The SBP has an exposé on Victoria Homes and the ownership (Danny Whelan, former business partner of bankrupt property developer Paddy Byrne). This is a bit of a non-story as I expect that every property development company in Ireland and internationally has founders, non-executive directors or ‘consultants’ who suffered blowback in/from the crash. In any event, Victoria Homes are on track to build 4,000 homes over the next few years. They have been successful in raising finance over the past few years when this was difficult, they secured some great sites around the greater Dublin area and they are consistently delivering high-end homes to the first-time buyer and trading up market. More of this please.
- The Money & Finance section has a piece for new home loan borrowers with some contentious advice like “DO avoid joint ownership if you can” – this is entirely disempowering advice for a couple (or for the non-owning half in any event). My tip: DO consult a solicitor and not a journalist before contributing to a mortgage that is not in your name.
- BIDx1 raised almost €24 million in online auction sales over two days, with five individual lots each selling for in excess of €1 million.
- Hines seeks planning for more than 1,250 apartments and over half a million square feet of retail/restaurant space in Cherrywood.
The Construction Industry Federation is holding its Annual Conference on October 12th at Croke Park with An Taoiseach, the Housing Minister, international industry leaders and tech speakers on the future of the industry. For bookings head to https://www.cifconference.ie/
For all things tech and innovation for the planning, construction and property industries, head over to http://www.prop-tech.ie, the national resource website for industry innovators, investors and mentors.
We have three free mentoring sessions left for #proptech start-ups (not just in Ireland!) in October and we are opening the list for November and December now – after Christmas we will have dates in January, February and March before this CSR initiative ends, email firstname.lastname@example.org for details.
Tom Courtney and his team at Property Basecamp are hosting a proptech meet-up this Wednesday, 4th October from 7pm in Devitts on Camden Street – details here: http://prop-tech.ie/proptech-meet/
Property Insiders Guide
Oak Tree Press is launching the new ebook series for the Irish property market next week, here is a sneak preview: http://www.successstore.com/property-insiders-guides.html
Also, as regular readers will know, the Irish Property Buyers’ Handbook is being updated for 2018 and I would love to hear about any experiences in the market or new services, technology and trends for buyers. As always, you are welcome to email me with any industry news and updates at Carol@CarolTallon.com.