All eyes will be on Taoiseach Simon Harris in the upcoming Budget to see what moves he will make towards his pledge to build 250,000 homes over the next five years. While this goal is above the Government’s current housing targets, it is more in line with what needs to be done to help address this country’s housing crisis.
Industry leaders have long advocated for annual supply targets to be adjusted upwards to between 50,000 and 60,000 new homes, to more accurately reflect and respond to the current and projected housing needs.
While it is crucial that more homes are built in Ireland, and that more ambitious targets are set in this regard, it is equally important that the basics are put in place first. Quite simply, 250,000 new homes will not be able to be built in Ireland over the next five years if power and water cannot get to those houses and if other basic infrastructure is not put in place.
About a year ago, the Society of Chartered Surveyors Ireland (SCSI) highlighted the long delays being experienced getting electricity, water and wastewater connections to new housing developments. The SCSI warned that these holdups were among the obstacles to delivering the huge amount of housing required to meet demand – and that the delays were also threatening the financial viability of many housing schemes. The SCSI called for “steps to be taken to resolve challenges associated with connection delays promptly, ensuring a more efficient and streamlined process for utility connections”.
A year later and these problems still persist. Significant delays with electricity and water connections are hindering the completion of housing projects across the country.
There is a huge mismatch between housing supply and demand across Ireland
There is now a concerning trend of infrastructure project delays and cost escalation in Ireland. The Shannon-Dublin water pipeline serves as a stark example of this. Initially conceived in 2011 with an estimated cost of between €700 and €900 million and a completion date of 2024, the project is now projected to cost between €4.5 and €6 billion, with completion pushed back to 2030.
This pattern of extended timelines and ballooning budgets for major infrastructure projects is not isolated. It raises important questions about our national capacity to deliver essential infrastructure efficiently. For home builders, this trend could impact on the timing and costs associated with servicing new residential developments, and also affect the overall viability of projects in certain areas. For house buyers, this trend could see them continue to struggle to find available and affordable accommodation for years to come.
The Dublin Chamber of Commerce recently warned that Dublin city could be facing a severe water shortage within the next ten years due to the lack of investment in essential infrastructure projects.
From the perspective of developers on the ground, there is a clear need to incorporate water-efficient designs and innovative water management solutions in new housing developments. Delays and uncertainty around new water service connection offers – as well as redesign requirements for water treatment plans – had led to huge uncertainties for developers. Projects are often delayed or not started until such issues are fully resolved. Getting a water service connection secured for a housing estate could take anything from 16 weeks to a year, depending on potential redesign requirements.
Developers and housebuilders are not the only ones facing the challenge of delays with electricity and water connections.
Significant delays with electricity and water connections are hindering the completion of housing projects across the country
Connection issues represented the majority of “complex complaints” made by consumers against Uisce Eireann in 2023, with one in four (27pc) of such complaints arising from connection issues. Complex complaints are complaints which are investigated by the utilities regulator, the Commission for Regulation of Utilities (CRU), when a customer has not been able to resolve their complaint with a supplier or network operator.
In a recent case investigated by the CRU, a customer waited about nine months to get connected to the water network[. The customer, who had applied for a water service connection in June 2021, had received a connection offer in September 2021, which the customer paid for. However, it took until the end of March 2022 for the connection to be completed.
In addition, in 2023, connection issues – including connection delays – were the third-most common customer complaints received by the CRU about gas and electricity networks.
Given the huge growth in this country’s population, these connection delays and issues will only get worse – unless the Government prioritises the delivery of major infrastructure projects.
In the 12 months to April 2024, the population in Ireland rose by 98,700 people – the largest 12-month increase since 2008, according to a report published by the CSO in late August. That same report found that immigration to Ireland has reached a 17-year high. This comes against the backdrop of the latest Census which found that in 2022, the population of the Republic of Ireland eclipsed five million for the first time since 1851.
There is a huge mismatch between housing supply and demand across the country. In Dublin alone, there are only 15.3 homes available to rent per 10,000 people, with even lower figures in other counties.
For house buyers, this trend could see them continue to struggle to find available and affordable accommodation for years to come
The demand for housing in Ireland – as well as the services and facilities those houses need – will not slow down any time soon. So, it is crucial that the country has joined-up thinking around the delivery of housing.
When zoning land, there should be a requirement on government agencies – including Uisce Eireann, ESB, local authorities and the Department of Housing – to ensure that basic services and facilities are in place.
Houses need to be built in areas with the infrastructure to support them. That’s not just power and water, but also the schools, transport, roads, footpaths, cycleways and other facilities that people need simply to live.
In its upcoming budget, the Government must prioritise the delivery of the major infrastructure projects that this country needs. The creation of a Department of Infrastructure, as proposed by the Taoiseach in his speech at the annual MacGill Summer School earlier this year, may well help in this regard.
Ambitious housing targets are all well and good, but without proper planning, joined-up thinking and the necessary infrastructure, these promises will simply never be lived up to.
Ian Lawlor is managing director of Roundtower Capital
