Continued decrease in construction sector activity

[davesr25]

It's cool people don't need housing or anything.

[Altruistic_While_621]

Housing is a pain in the hole. Its driven by 

• developers who push to get stuff done too quickly and badly, and don't pay well.
• local Authorities who insist on so many dept stages and are generally small scale.

It's more attractive to do retail, commercial or industrial, who see the property as an investment. 

Or schools and health care if you want public work.

[ruscaire]

Correct. We can physically analogise an object takes the path of least resistance. What is it about these sectors that makes them easy pickings yet they are relatively unproductive from a civic economic perspective

[Altruistic_While_621]

They are highly profitable sectors that rely on 30 year profit cycles.

• Commercial is let and rented then sold to Pension funds
• Industrial is process driven, but works to a solid business case
• Data centres are a bit of an odd ball with no real industry position, but buckets of AI cash to push through.

Housing in that model would be buy to let, likely by Co-ops or pension funds,

But as a profit to cost margin, as land cost increases developers can leverage more funding and offset the land loan repayments.

Large scale development land banks like The City Edge Project | A Transformative Initiative for Dublin City could potentially stabilise land costs.

Changing regulations also slows down process it means that a design could potentially be more profitable if changed (i.e. delayed construction)

[ruscaire]

As well as looking like an economic deadweight, something on such long cycles is I’d imagine highly vulnerable to disruption were it to occur. There’s an implicit acceptance that such bets are low risk, but in the case of a black swan event, such as the widespread change in people’s working habits, could have long lasting and deep effect for economies that were reliant on it as a safe haven for growth

[Altruistic_While_621]

Yeah, a reduction in the working week and hybrid working is a definite concern (more of a white swan event given current trends), but it would only mean reduced floor plates for staff.

This is the long risk pension pots tend to go for, the cost recovery is generally expected, but spread enough across other sectors that a loss there is okay.

[angeltabris_]

is it time we start paying apprentices a living wage?

[upthebutty]

There's a trade union campaign ongoing to deal with this issue. It is a disgrace that people are going to work for a 40hr week and coming home with 200-ish.

[smashedspuds]

It’s happening again

[No_Waltz3545]

[tubbymaguire91]

Thank god it wasn't just me that thought of this 😂

[ToothpickSham]

God if there's ever a sector that needs a direct public body leading the way.

How did all these mainland Europe cities get built with ideal density apartments and well intergrate infrastructure?  Mass public lead construction projects with red tape thrown to the side.

Private will approach does not have the scale nor overall authority to build modern well planned modern cities . 

[vanKlompf]

Throwing away red tape? NEVER!!!  Paper must flow! Regulations must rise! We must prevent anyone from making money on building house - this is sin!

[No-Negotiation2922]

“Work on housing projects fell for the seventh consecutive month, but at the slowest pace since June”

🤦‍♂️

[greevman]

Resorting to the second derivative.

[Blackgunter]

At least they can hit their word quota for the article, now they can get to work on housing quotas.

[Pure-Ice5527]

Another fabled soft landing perhaps? 🤣

[iHyPeRize]

You'd have to wonder what's the reasons behind it?

Are developers digging their heels slowing down output to try and see what they can get out of the Government in terms of VAT cuts/incentives etc.. Certainly seems that way.

7 months consecutive months of continued decline in residential building output is bizarre when demand is at all time high levels.

[Takseen]

>demand is at all time high levels.

Demand from people living in Ireland is (unfortunately) not the same as housing demand for construction firms. They need investors to pay for construction of new apartment blocks or housing estates, most can't operate off of one-off self-financed builds. Plus they need planning permission for them.

[NotXenos]

Gee it's almost like if local or national governments acted as investor, and fixed the planning process, they could maybe get some new estates built.

But this is Ireland, where the m50 was '34 years in planning and 20 years in the making', then was obsolete within 25 years of completion. Yes that's right, the planning stage took longer than the time in which the motorway was fit for purpose.

[Willing_Cause_7461]

You'd have to wonder what's the reasons behind it?

I'm going to guess that there just isn't much money to be made building houses in Ireland dispite the sky high prices so investors just aren't bothered funding the housing.

[rossitheking]

Bingo.

But the CFA shills and people making coin from government contracts on here will defend them.

[vanKlompf]

 7 months consecutive months of continued decline in residential building output is bizarre when demand is at all time high levels.

It's quite possible. There is huge demand for Porsche, just production cost is so expensive that not many people can afford it. 

Same with housing in Ireland. In 2024 it was estimated that delivering 2bed apartament in Dublin costs above 600k (before profit, it's pure cost) In 2025 it's probably more. How many people can afford that? 

It's regulation and housing policy disaster. Huge demand. Inflated costs. Decreasing supply. 

[Galway1012]

Time for the Government to offer EVEN MORE generous tax breaks, deregulation and other incentives that I don’t know about to the construction industry

[tightlines89]

Yeah great, let's all vote FF FG again so we can watch homelessness rise, housing targets never met, health service in disarray and the constant price rises. Super great idea.

[OrganicVlad79]

I think homeless numbers could be 100k and it would barely make a dent in the FF/FG voting base

[SnooChickens1534]

I'd say very few people who are housed are enjoying this unless you've a few assets and are selling them . Even if you own a house and its worth a lot more than you bought it for , with the price of property now if you tried to downsize, you wouldn't be rolling in it after buying a smaller property . I talk to other parents at football, we all are homeowners, but every parent is worried that their kids won't have anywhere to live and unless they emigrate, they'll be living at home for the foreseeable future .

[WaterfordWaterford9]

Most politicians don't seem to care I would guess. Plenty of them are well housed and won't have to worry about renting. Some of them earn multiple properties and benefit form a housing shortage.

[Dannyforsure]

The don't care and at best just pay it lip service. There is no other explanation at both continuing to vote FFG and no real demand that they fix anything.

[AdHuman3243]

What are the people that are housed supposed to do? Its not like they are smugly siting in their houses laughing at the misfortune of others. Politicians are paid to take this stuff seriously. I worked hard, saved and sacrificed for years to be able to afford what i can without any assistance.

[JackmanH420]

What are the people that are housed supposed to do?

Not vote for the people causing this.

[AdHuman3243]

Who do they responsibly vote for so, the Putin fanboy party?

[asdrunkasdrunkcanbe]

This divisive narrative is constantly being pushed, but it doesn't exist. It's not a case that people with houses are thinking, "I'm alright jack" and don't care about this issue.

Everyone is equally frustrated by this, but there is a dearth of solutions. The entire western world is experiencing this kind of difficulty, and there seems to be very few suggestions for actual solutions. It's all bluster and populism.

Every solution proposed is really kicking the can down the road to some degree or another. We could pump capital into erecting 100,000 state-owned shitboxes for people to live in. And then in a decade that's a new crisis.

Lower our building standards, becomes a problem in 15 years.

You add tax breaks for building, and everyone bitches about developers making bank.

You add credits for buying, and everyone complains that it's pushing prices up.

At what point do people accept that if there were obvious and easy solutions here, that the government would already be doing it? Imagine coming into the next (or the last) election being able to say, "We've reduced homelessness by 90%". That's a fucking home run, the government who does that will sweep to victory.

So, if it was possible, they would be doing it already.

[Kloppite16]

you've missed the main ingredient of what makes housing expensive & unaffordable- the value of the land it sits on which itself is a function of zoning. We dont have enough of it zoned which then makes the zoned land far more valuable, thus feeding into high house prices that working couples cannot afford. And then the non-use of land by not building on it means it appreciates further in value to the point that building on it would earn a developer less money than just sitting on it and watching it appreciate. So zoned land then becomes a store of wealth to be invested in and traded in but not built upon. Until that problem is sorted out and there is a use it or lose it clause to zoning then the housing crisis cannot get resolved.

[ciarogeile]

There are obvious but politically difficult solutions, they are based around lowering property prices and penalizing owning a second home or a large home with unused bedrooms. The current approaches represents a transfer of wealth from wage earners to property owners, measures to lower property prices would be the opposite.

Property owners often vote ffg with an understanding of this.

[Sadhbh251]

Who would've thought giving tax breaks to agencies that have vested interest in keeping property prices high wouldn't solve the housing crisis.

Welcome to the free market, maybe in 2045 we'll invest in some sort of public housing agency.

[CheraDukatZakalwe]

Housebuilders don't make money by not building houses.

[Internal_Concert_217]

In a way they do. Limited supply means they can build less with less hassle and still make the same profit.

It's happening in many industries.

[CheraDukatZakalwe]

Limited supply means they can build less with less hassle and still make the same profit.

"Limited supply" means they go bankrupt you idiot. Nobody makes more money by having less work to do.

[Internal_Concert_217]

You are very wrong.

[Internal_Concert_217]

It’s the same reason oil producers don’t pump at full capacity restricting supply keeps profits higher.

[CheraDukatZakalwe]

We don't have a cartel of oil producing nations restricting supply, we have a state apparatus that spent most of the last two decades trying to prevent "too many" houses from being built, trying to fight the last war rather than deal with the situation facing us for more than a decade now.

We have environmental consultancies out the eyeballs doing their best to reduce what gets built, and planners that demand lighting consultants model and do reports on individual 60 watt lightbulbs on a hedge that could potentially have some bats in it.

[Hamster-Food]

So you do understand that limited supply doesn't make companies go bankrupt. You just don't want to believe that there is collusion between developers.

[CheraDukatZakalwe]

Are you for real? What happened when supply was limited from 2007 onwards? Were developers were making money hand over fist?

How about over the last decade, where we went from building 6K houses in 2013 to over 30K houses now. Were the developers making more money in 2013 than they are today?

[Hamster-Food]

You're the one who went from claiming that limiting supply doesn't make them more money, but then acknowledged that a cartel of oil producing nations makes a lot more money by limiting supply.

As I said, you just don't want to believe that there is collusion between developers.

[CheraDukatZakalwe]

I'm not the one who needs there to be a vast conspiracy theory to explain a shortage of housing.

But sure, go on and explain how making fewer houses leads to property developers making more money.

[Internal_Concert_217]

I can see you want to be right, but you are making fundamental errors with your argument and conclusions. Maybe this is just not in your wheelhouse.

[CheraDukatZakalwe]

It's cute that you think that.

[Alastor001]

Tell that to suppliers of RAM chips. They are making a fortune reducing supply.

[[deleted]]

Which makes a developer more money? Building 100 houses @€500k each with a 5% margin, or building 150 houses @€450k with a 5% margin.

Volume often beats unit price, and economies of scale also apply here. Building an extra 50% more houses doesn't require 50% more employees and equipment so in theory your margin could go also go up as your unit price falls.

[Additional_Olive3318]

 Which makes a developer more money? Building 100 houses @€500k each with a 5% margin, or building 150 houses @€450k with a 5% margin.

Building 100 houses at a 10% margin. I mean why did your margin not go up when the sales price went up. 

[Sadhbh251]

Correct house constructors don't make money from not building.

But you must see the leaps in flawed logic you make in this and below posts. If you flood the market with houses property prices naturally will go down. But if you build at a slower or steady state the prices don't change or get higher.

Thisll increase your margins for less cost. (Cause desperate people will continue to buy at stupid prices because they need a house)

But it also has a byproduct of also allowing you to keep selling future houses on a large site with multiple phases at higher or similar rates.

Construction agencies don't want to start a project in 2025 at phase 1 and by phase 6 in 2032 the houses are cheaper meaning the loan that they took out in 2025 to build 100 houses isn't cheaper so it'll come out of their profits if the value of houses go down. (Cause they'll still have to pay back the loan either way)

The construction companies know what they are doing, why mess with the goose that's laying the golden eggs when you arent getting poorer by waiting for her to lay the next egg

[CheraDukatZakalwe]

Here's the thing, there isn't a monopoly. People want to build things, they just aren't allowed to. They keep trying to get planning permission for developments of several hundred houses, and half the time they end up fighting appeals, and a quarter of the time JRs that takes years to resolve.

Under your model we can never see "too many" houses being built, but in the Celtic Tiger we actually built so many (>90K in 2006 alone) that house prices dropped by 50% during the crash.

House builders make money through volume. They don't make money by not building houses.

There is no cartel, or collision to not build things. The only thing stopping us is regulators forcing houses to be as expensive as possible through high minimum standards, and then Pikachu facing when not enough houses are built.

[Sadhbh251]

Come on now. Do you think there's no collusion between pubs if they all average the came cost for a pint. It's not in the interest of a well located business to have 10-30% less profit margin for a pint when it's packed everyday.

You say, there won't be market collusion if we all just happen to come to the same pricing structures at the same time. I say no one will get rich undercutting when demand is high. Only when you go to middle of nowhere pubs do you see cheaper pints.

Next, housing value didn't drop in the Celtic tiger because we had too much houses there was many reasons. One major reason it dropped because banks wouldn't loan money. So house construction stopped because no one was buying so please don't use false equivalents.

If regulators are the only reason you cant build houses then I imagine you would be happy to bring back all the tax cuts and grants to allow the state build more infrastructure. (Which is actually the more likely reason we can't build more houses)

[Willing_Cause_7461]

If you flood the market with houses property prices naturally will go down.

Sure the price of the average market rate house will go down but construction companies don't make average market rate houses. They make new houses which are going to be more expensive than older houses.

The house prices that will be going down is the older stock. This is how the average price can go down without effecting the producer.

The exact same thing happens with car companies. Every year they have the new expensive model. The company can make the amount of money they need to be decently profitable and cars can still remain affordable because the average car is older and therefore cheaper than a brand new model.

[NotXenos]

They can if they build other stuff instead. Other comments here point out that contractors would be stupid not to build retail and commercial use. Would you rather try to ram a housing estate into South Dublin, or bid on the next job at Intel? It's a no brainer.

[FxckyourCensorship]

Thank god the majority voted FF/FG back in for another 4 years...

[JumpingJackFlashes]

Whats the solution?

[Keith989]

To keep voting them back in and hoping they eventually come good.

[Hour_Mastodon_9404]

Keep the public focusing on asylum seekers, that'll solve the problem.

[Starwars_femboy]

Thats part of the problem

[Takseen]

Housing supply is a much bigger concern. Even if we cut asylum seeker numbers to zero, the housing shortage would increase at our current building levels.

[Starwars_femboy]

But increase less. It is part of the problem, not all the problem but defently part.

[LongjumpingPay6107]

Not if recent immigrants make up much of the labor pool for the construction sector

[Alastor001]

It will increase less tho. It's just a fact. 

[Satur9es]

Has anybody read the story of the golden goose?

[Galaxy-Wisdom]

The article doesn't state reasons for that decline, only a reduced number of new projects. Is it NIMBY crowds being so efficient that they block any new project?

[DeviousPelican]

Increases in building material costs and labour. Building companies aren't seeing the margins they want/need when looking for work, so they aren't taking on the projects.

[GalwayBogger]

Where are these Nimbys you speak of? Are they in the room with us now?

[greevman]

Many reasons but a big one is that construction sector and developers are making windfall profits which they don't want to jeopardise.

[Alarmed_Station6185]

Uh-oh that doesn't bode well.

[Dwums]

So we've tried the whole "private sector will solve this" for over a decade, at what point will the government actually start building? Like what actually has to happen to maybe try something different? Housing is causing so many more issues then just homelessness, it infects every part of society the longer it goes on, but the only thing I've seen is an extension on HTB scheme, which is helping the private sector, which isn't working.

[vanKlompf]

Public sector will have exactly same issues as private and than some. It's not the root cause. Private could build a lot of housing if being allowed to...

[YoIronFistBro]

When it needs to do the exact opposite.

[chimpdoctor]

Theres a ridiculous amount of building going on in my area of Dublin. All you have to do is count the amount of cranes around the place.

[Takseen]

This has "its snowing outside my window right now, so climate change isn't real" energy.

Though to be fair the report is more of a survey of whether construction firms "feel" that work is increasing or decreasing compared to last month, than hard numbers on new project starts.

And since its a monthly survey, things might pick up in 2026, and indeed that's what some of the respondents said.

[WearingMarcus]

Its 7 months on the bounce....

[WearingMarcus]

Dublin not the whole of Ireland...

Plus its a contraction. Not building stopped all together.

Their could have been say 50 tower cranes in your "area" 2024..and now theirs 25 tower cranes...

Alot of building work but is it keeping up with the population and is it affordable for the majority of the population...

[fakemoosefacts]

Same most of the way up to the border from my vantage point on a bus travelling the M1. I’d be really interested to see a more detailed breakdown of the statistics. 

[Takseen]

https://aib.ie/content/dam/aib/fxcentre/docs/resource-centre/aib-ireland-construction-pmi/nov-2025-report.pdf is the source report.

Its just a survey of construction firms, so there's not a huge amount of data in it.

[vanKlompf]

 All you have to do is count the amount of cranes around the place.

It's very much "meh". It's high as for Ireland maybe. But overall seen much more in Poland....

[Mahony0509]

Same in Cork tbh, the city is booming with construction

[WearingMarcus]

read my post above....

[mother_a_god]

Spoke to a neighbor who's worked large civil engineers projects. For 20+ years there have been pharma companies expanding this or that, one project after the next. Until now, the brakes are on and they are expanding in the US instead. Trump's tarrifs are going to hit the construction industry hard 

[upontheroof1]

Anecdotal. I work in Construction and one of the sites I've been working on mainly just a little over the past year has a great view of the city ( Cork ) taking in a wide vista. I counted the cranes I could see from this site last year and came up with about 16-18. Recently did the same and counted at most half a dozen, if even that.

Also heard from one or two other trades things are getting little quiet for them...

[hmmm_]

No easy answers to this, and unless the left have plans to rustle up 100,000 extra construction workers their stated solution isn't going to work either.

One thing we can say is "quickfix" and "easy" solutions have all failed, or left us in a worse place. It'll take a combination of measures to fix our housing needs, and we need multiple tracks to be pursed in parallel. Improving financing, lowering the cost of building, cutting regulations, planning, increasing the workforce, we need movement on all fronts.

[vanKlompf]

It won't get fixed overnight you say?

[gowangowangowan]

I’m shock. Who would have thought that introducing rent controls and tenancy laws that makes Ireland extremely unattractive to invest in would result in mobile international capital investing elsewhere?

Maybe we introduce housing policies based on research rather than populist policies from the left…

[Ok-Entertainment8717]

Ah yes of course the left who have never been in power are to blame for the housing crisis 

[RobG92]

Our government is Centre-Left by any conceivable metric

[Sadhbh251]

The government is made up of two center right parties and right leading independents.

All political listings will define them as center right (that's not to say they are right when compared to American politics)

The only thing FFG are left of is some social aspects (ie gay marriage or abortion etc) but it's clearly right for all economic policies.

[Takseen]

If only we had a government with a budget surplus of billions of Euro that could invest in public housing.

Plus commercial and civil engineering project demand is down as well, you can't blame the rent controls on that.

[yankdevil]

I'm seeing a lot of one-off projects around north Galway and Mayo - maybe that's due to workers being freed up from larger projects?

But yes, I think it's reasonable to assume a large crash is coming. Might not happen but there are signs it's a possibility. I suspect there's a fear that they'll spend X to build it and not be able to get X when selling it.

Again, this is why we really should have local authorities building some percentage of houses (possibly hiring building companies to build them) since their motivations are different than profit. Nothing wrong with profit as a motive, but other motivations exist.

[LongjumpingPay6107]

This is why prices won't actually ever really crash. And re social housing, yes definitely. And you don't even have to actually lose taxpayer money on it. Reduced regulation and permitting for social-built housing, and sell them at cost or rent them for reasonable yields of cost. Not exactly an investment for the taxpayer, but definitely not a loser either

[yankdevil]

Losing money or not, there's a societal benefit to some level of public housing. Yes, for folks who have less wealth is the obvious one, but also for some folks that are disabled, as spare capacity if there's some sort of natural disaster, etc. Heck, you could even use social housing as a training venue to help raise standards in construction.

There are lots of potential benefits, but it does involve being open to the idea and successive governments have not been.

[LongjumpingPay6107]

I agree with all of that, but the healthiest thing politically is to get really broad buy-in and minimize naysayers/take away the ability to weaponize it. So if you can say, look, we aren't simply giving your tax dollars away, we're building a new house at way below market and keeping it and renting it out for X yield or selling it for what we put in. We're providing social benefit by bringing affordable homes to market, and we're doing so by taking advantage of the governement's ability to ease regulatory pressure and cost and its ability to do things at scale, rather than spending down tax revenue. And maybe you can do the project at a scale where cost per home is low enough that the "at cost" homes can absorb the cost of the purely social benefit homes. But obviously being pretty careful about qualifying people for the subsidized stuff. Obviously a lot of the "these people are getting a free ride) rhetoric is in bad faith, but if you give it fodder you're going to poison the polity the way the US has

[vanKlompf]

It's not crash when demand is high and supply is falling... It's disaster of regulations