Housing shortage to fuel surge in prices

A projected shortage of residential properties in Galway in the coming years is likely to fuel increasing house prices and rents.
A report issued by the Government ESRI think tank this week has predicted there will be a shortage of more than 3,000 homes in Galway by 2021.
And with residential sales in Galway already up 55% in the first quarter of this year (Property Price Register statistics), private rents and house prices are being driven up.
The study published this week by the Economic and Social Research Institute (ESRI) on projected population change and housing demand has found that the number of households in Galway will increase by around 1,200 each year in the coming years.
Already, auctioneers in the city have widely reported a shortage of quality homes for sale, which has the knock-on effect of driving up prices because of pent-up demand.
According to Dr Edgar Morgenroth, who penned the report, there will be a shortage of homes, unless construction gets underway.
He has predicted a requirement for more than 3,000 homes across Galway by 2021. “The analysis I’ve carried out looks at population projections up to 2021 and the degree of housing need.
“Without additional completions, we’re going to be in a position where there isn’t enough housing to meet demand,” he said.
Dr Morgenroth pointed out that planning and building larger developments takes several years, so builders are not in a position to start construction immediately to meet demand.
“One must consider that for larger developments, there’s a planning lag. It takes a number of years to plan and build those large estates.
“We can’t turn around a situation where we have very little construction to one where we have fairly substantial construction very quickly. There’s always going to be that lag,” said Dr Morgenroth.
For more on this story, see the Galway City Tribune.