Dáil Éireann díospóireacht -
Thursday, 10 Oct 2002

Vol. 555 No. 1

Written Answers. - House Prices.

Thomas P. Broughan

Ceist:

47 Mr. Broughan asked the Minister for the Environment and Local Government if his attention has been drawn to figures produced by the Small Firms Association showing that the cost of building houses had increased by 39% since 1996, but the cost of buying them has increased by 138%; the steps he intends to take to deal with the huge increase in house prices which the Small Firms Association has described as creating huge pressure on wage inflation; and if he will make a statement on the matter. [17335/02]

Minister for the Environment and Local Government (Mr. Cullen)

I am aware of the figures cited by the Small Firms Association. My Department understands that the figures for the increase in the cost of building houses are derived on a CSO construction index, which is based on official wage rates and listed material prices. The index would not include items such as rates paid to subcontractors, overheads, interest charges, land holding or development charges, profit, etc.

Nonetheless, the rate of house price increases in recent years, resulting from strong economic and demographic growth, has been of serious concern to the Government and has led to a range of responses which have had a positive effect in increasing housing output and moderating house price increases. Average year on year house price increases have been reduced from a peak of around 40% per annum in 1998 to about 5-7% per annum currently. Last year was the sev enth successive year of record housing output with a total of 52,602 units completed.