A research note published today [pdf] by the ESRI (Economic and Social Research Institute), summarises recent research on the impact of projected population change on housing demand at the county level. It forecasts that up to 60,000 new housing units will be needed in the Dublin area by 2021.
The analysis highlights how varied the projected changes are across the country and the consequences for housing demand. It shows that, while demographic change implies a total of 180,000 additional housing units will be required between 2011 and 2021, the large number of existing vacant dwellings will reduce this requirement, by half, to 90,000 units.
The chart above shows that the increase in the number of households is projected to be particularly large in Dublin, and to a lesser extent in the other large cities and the surrounding counties around Dublin. For Dublin the annual average increase is projected to be almost 8,000 households, which has significant implications for the required housing units, particularly if one considers that during 2013 only 1,360 units were completed in Dublin.
For the State as a whole on average just under 18,000 additional households are projected to be created each year between 2011 and 2021, which is smaller than the 20,000 predicted by ESRI economists due to the simpler approach used in generating household numbers. They calculate the number of households on the basis of age specific household headship rates while the approach taken here is to apply the county specific household size for each county which are assumed to follow the same trend. Thus, the approach used here does not consider age specific factors in household formation.
Noting that there is considerable oversupply in many counties, the note author, Dr Edgar Morgenroth said: “Of the 90,000 additional housing units required between 2011 and 2021, over 60% (54,000 units) are needed in Dublin and a further 26% are needed in counties Louth, Meath, Kildare and Wicklow. Thus the requirement for additional housing units is projected to be highly concentrated in the Greater Dublin area.”
He continued: “Given that the total number of housing completions recorded in the Greater Dublin Area during the 2011-2013 period is below what is needed to meet demand, this will result in significant housing shortages in the Greater Dublin Area if the rate of housing completions does not increase rapidly.”
© Copyright 2015 by Finfacts.ie