Monday, 30 March 2015

Planning permissions show how little we've learnt

Paul Sweeney: This Infographic on planning permissions, published by the CSO last week, tells a lot about the Irish economy and Irish people.

Source: Central Statistics Office 

On the top left we can see that there were fewer than 2,000 applications granted for new houses in the last quarter of last year compared to a staggering 10,000 in the end of the boom year 2008. We can safely bet that most of those granted were never built as the crash happened in 2008.

Similarly there were applications for almost 3,400 apartments granted at end 2008. In stark contrast there were only 152 apartment applications granted at end of last year. So there were almost 14,000 planning applications granted in just a three month period at the end of the bubble in 2008. This was in sharp contrast to last year when there were a miserable 2,057 planning applications, well short of what is required. This, however, was up 32% on the same period in 2013.

If we look at the box on the top right hand side of the Infographic, a shocking statistic is revealed. Of all the applications for housing, half of them are for one-off houses. And the one-off houses are twice as big as multi-development houses, (box below) telling us a lot about what kind of people are building them i.e. they have plenty of money.

In spite of the bubble have we learnt nothing? Why are we still allowing people to build so many one-off houses? In other countries most new homes are in towns or villages – not scattered across the landscape costing a fortune in service provision and destroying the physical landscape for generations. In Northern Ireland, most houses are in urban developments.

While there is a good pick-up in the economy, it is surprising to see that at the end of last year, half of all planning permissions were for extensions or alterations and not for new houses or apartments. I expect that this has already changed in the five counties – the main city counties - which are clearly enjoying the economy renaissance – Dublin, Cork, Waterford, Galway and Limerick as seen in the final graphic above.

Paul Sweeney is Chair of TASC's Economists' Network 

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