The supply of housing and accommodation is one of the most immediate of the domestic challenges the country currently faces. Driven by unsustainable residential construction, the scale of construction output grew to an unprecedented 25% of gross national product (GNP) in 2006 before dropping dramatically to 6.4% of GNP in 2012. Housing supply contracted sharply from late 2007, with the number of new dwellings falling by over 90% between 2006 and 2013.
The need to address the undersupply of housing is well recognised and it is for that reason that the issue has been, and remains, a top Government priority. Through its comprehensive Rebuilding Ireland Action Plan for Housing and Homelessness, the Government is committed to creating and maintaining a capable, effective and sustainable housing sector, on the right scale, avoiding previous boom and bust cycles. Under the Action Plan, the social housing needs of over 137,000 households will be met over the period 2016 to 2021, supported by over €6 billion of investment, and housing supply more generally is targeted to increase to at least 25,000 homes per annum by 2020.
Rebuilding Ireland is having a significant impact, with nearly 26,000 households having their social housing needs met in 2017 alone, significantly ahead of target. In order to get overall house-building at scale activated again, the Government is investing nearly €275m in enabling infrastructure, has streamlined the relevant planning and regulatory processes, made development finance available and has introduced a vacant site levy.
In terms of housing output, all housing activity indicators continue to show encouraging trends. For example, over 18,000 new residential construction commencements have been notified over the twelve months to end-April 2018, an increase of 23% year-on-year and planning permission was granted for almost 20,800 new homes in 2017, an increase of 27% on 2016.
In terms of housing affordability, I have commenced the relevant provisions of the Housing (Miscellaneous Provisions) Act 2009, to place the new scheme for affordable purchase on a statutory footing. Just yesterday, I announced details of a major cost rental project with the potential to deliver over 300 cost rental homes at Emmet Road, Inchicore, as part of a mixed-tenure development of some 470 homes in total. This will now form the framework to be rolled out across other suitable sites.
In order to support local authorities to get their sites ready for affordable housing, I am providing €75 million in funding for enabling infrastructure via the Serviced Sites Fund. When local authority co-funding is included, an overall minimum investment of €100 million will be provided to those sites that require infrastructural investment in order for them to be brought into use for affordable housing. The call for proposals under the Serviced Site Fund has now issued and I expect to award funding in the Autumn.
Progress on Rebuilding Ireland is kept under review and since taking up office, I have met with a range of key housing stakeholders on many occasions to discuss the main implementation issues. For example, this was a priority topic at the recent Housing Summit with local authority Chief Executives and it also featured prominently at a post-Summit meeting with local authority Housing Directors of Service.
I am confident that full implementation of the comprehensive set of actions laid out in Rebuilding Ireland will result in a much enhanced supply/demand balance in the housing sector, with consequential wider economic and social benefits. My Department and I will continue to remain firmly focused on implementation in the months and years ahead.
