Author Archives: admin

Central Bank | More turbulence in housing market?

Mortgage+agreement+app

In this article in the Independent on 11th December 2014, author Mark Keenan discusses the possible negative effects of the latest government intervention in the housing market. Readers are aware, despite increases in rental and sale values, that current market conditions including increased costs associated with recent ‘red tape’ building regulation have restricted the supply of new homes. Proposed Central Bank credit limitations could impact further and push a lot of new residential developments out of the reach of new buyers. In an industry struggling to get started this latest development, added to the drag of recent government building regulations, could seriously affect the tentative construction recovery.

Link to full article here. Extract:

Half of new homes face axe over mortgage proposals

Joe Charles, of Caledonian Life, said the fall in mortgage protection policies being taken out by those in their 20s was down to them not taking out mortgages

AROUND 5,000 new homes worth more than €1.25bn and accounting for almost half of all planned output for next year face being scrapped.

The construction industry has expressed fears over the Central Bank’s new loan-to-value (LTV) and loan-to-income (LTI) requirements. Strict new mortgage lending measures will play havoc with building at both ends – first by eliminating a huge tranche of buyers and second, by causing banks and private financiers to withdraw promised capital and finance for big schemes.

One source added: “In most cases, those schemes which have gone ahead have only just got funding by the skin of their teeth.”

The source said that if the measures went ahead “almost all” multi-unit schemes currently being planned would be postponed or curtailed altogether. Multi-unit schemes are likely to make up around half of the 10,000 or so homes planned for next year.

The claims follow the lodging of a new report warning of the unexpected impacts of the new mortgage control measures. Compiled by Grant Thornton, and funded by the Construction Industry Federation, it has been submitted to the Central Bank this week.

It lists “cessation/non commencement of construction” as one of the “unintended consequences” of the new measures.

A spokesman for the Construction Industry Federation (CIF) said: “In a lot of cases our members have said that they are planning to put residential projects on hold if these measures are introduced.”

First time buyers in Dublin will now have to save an average of €70,000 to buy a €350,000 home and most builders and their financiers believe this is too big an ask for young couples.

It has already been estimated that 40pc of the home loans paid out in 2014 would not have transacted at all under the Central Bank’s new rules.

The report estimates that saving for a deposit and paying rent for a home at the same time in Dublin means a couple will have to set by €2,575 per month.

“Across the construction sector there is likely to be a cessation in on-going construction programmes and a reduction in the numbers of commencements, as a consequence of the proposed policies.

“Such policies will both reduce the commercial viability of many projects and increase the likelihood that working capital support from institutions may not be available,” the report says.

Other effects include:

  • A knock-back to employment caused by the resulting loss of work to those directly involved in the sector as well as “knock-on” jobs like solicitors and surveyors.
  • The exclusion of “credit-worthy” candidates from home purchase on the basis that first time buyers tend to be in the early stage of their careers and the most likely to increase their incomes going forward.
  • An increase in unsecured and “risky” credit used to beat the mortgage cap – the report says it happened in Sweden when “hard LTV’s” were introduced.
  • Increasing rents, as forced-out buyers turn to letting in a market where supply is already restricted.
  • A negative impact on Foreign Direct Investment as rents increase. This will also lead to a further, increased demand for social housing.

The report describes the proposed Central Bank measures as “a blunt tool” usually employed to deal with an overheating market, whereas most of Ireland’s market (outside of Dublin) is clearly not overheating.

It is critical of some of the factors which currently cause Ireland to have some of the highest-priced housing in Europe – most notably it criticises the high cost of local authority levies and taxations to home construction.

Finally, it asserts that measures outlined for Budget 2015 are “unlikely to address the fundamental issues that are hampering supply.”

Other posts of interest:

Pyrite: the spiraling cost of no Local Authority Inspections

A ‘perfect storm’ for housing?

The € 500 million + cost of S.I.9 in 2014 | Residential Sector

SI.9 costs for a typical house

How much would 100% independent inspections by Local Authorities cost?

BCMS Commencement Notices | Nine Months On

CSO | Construction output increased by 0.1% in Q3 2014

Developer makes 27% profit in 6 months: warns against state housing.

Completion Certificates for Multi-unit Housing

Catherine Murphy TD | Today’s Housing Promises Won’t Bear Fruit for at Least Two Years

SI.9 Cost for 2014 = 3 x Ballymun Regeneration Projects

Ronan Lyons | Regulations pushing up the costs of homes

Sunday Business Post | Karl Deeter “Building regulations – rules don’t deliver results”

CSO- Dwelling units approved down 16.6% in one year

Want to live in Dublin? | Only the wealthy need apply!

World Bank Report 2015 | Ireland’s poor construction regulations are the biggest drag on our ranking

€ 5 billion | The extraordinary cost of S.I.9 self-certification by 2020

“House building costs are 17% more than 2003 despite recession” – Bruce Shaw

Ch.3_—_Ireland

Ireland, Knowledge Centre – Bruce Shaw

Professionals frequently refer to the Bruce Shaw Annual Review for information on costs, trends and the construction industry generally. In this post we look at activity in the house building sector and where savings could be targeted to make housing more affordable. Here’s  link to the full document: Bruce Shaw Knowledge Centre

This year’s edition of the Bruce Shaw Annual Review is no different providing a wealth of interesting and accurate information on a multitude of aspects of the construction industry. It is not the only one of its type but source information frequently is Central statistics Office data so is quite reliable.

We noted there has been a lot of media attention at a predicted “construction boom” with an output of €11Bn forecast for 2015. When one removes the €600m associated with water meter installation, this figure reduces to €10.4Bn. A 15% increase on 2014 projected level of €9Bn is good news; however we are coming from a historic low point in construction activity.

€10Bn is the same as the 2010 level of construction output and well below the level needed to achieve a sustainable level of construction activity in the medium term- see Forfas Report (p10):

forfas report page 10.pdf [Converted]

(Pdf of Forfas Report: Ireland’s Construction Sector: Outlook and Strategic Plan to 2015: forfas)

Construction output is half a normal sustainable level and this indicates that there may be further market distortions due to supply and demand issues in some sectors and locations etc. To give this more modest forecast some background here is a graph with recent years construction output noted:

Value of Construction Output €m 2004 – 2014

construction output

We also note construction costs for housing remain stubbornly high. In the following graph we see that house-building costs are over 17% higher than in 2003, despite the recession. The graph illustrates that house-builders appear have kept costs high, preferring to delay activity to build demand and maintain profit margins rather than reduce costs. We note a recent Davy Research report that suggested Irish construction costs were 50% higher than in Northern Ireland. Economist Ronan Lyons has been calling for a full audit of the cost of building a home for some time- this would have many benefits because state investment in social housing would go further and new homes would become more affordable. (Link to Ronan Lyons commentary here).

House Construction Cost Index

houe cost index

In this series of tables showing house completions, we see that only 11%, 922 of the total of 8,301 dwellings completed in 2013 were apartments, suggesting that individual commissioned or self-built houses comprised a very high proportion of dwellings completed that year. Self-builders may well comprise over 50% of all houses completed in any one year.

Annual House Completions 2003 – 2013

house completions

Annual House Completions by Type 2003 – 2013

completions by type

Finally of interest to Government will be house building costs. Note the specific exclusions which generally add approximately +12.5% and additional costs of SI.9, estimated at between €20,000- €40,000 for a typical 4 bed house.

The Bruce Shaw figures exclude VAT, professional fees, SI.9 costs, developer’s profit and site costs. When the extra SI.9 cost of €21k ex vat, developers profit of 20% and other costs along with VAT of 13.5% is added to the build cost, the sales price of a typical 3-4 bed 125 SqM house is over €290,000 excluding site purchase costs. This excludes the cost impact of recently introduced social and affordable (Part V) levy of 10%.

 

house build costs.pdf [Converted]*Breg Blog note: for additional SI.9 costs for a typical house see SI.9 costs for a typical house | BRegs Blog

Other posts of interest:

€ 5 billion | The extraordinary cost of S.I.9 self-certification by 2020

How much would 100% independent inspections by Local Authorities cost?

‘Onerous’ Building Regulations must be amended – Minister Kelly

SI.9 Cost for 2014 = 3 x Ballymun Regeneration Projects

Ronan Lyons | Regulations pushing up the costs of homes

CSO- Dwelling units approved down 16.6% in one year

World Bank Report 2015 | Ireland’s poor construction regulations are the biggest drag on our ranking

12,000 social + affordable houses at no cost to taxpayer?

Soaring house prices and rising rents could damage economy | National Competitiveness Council

COVER.pdf [Converted]

In this article in the Independent from December 3rd 2014  “Soaring house prices and rising rents could damage economy“, author John Mulligan discusses the 2014 National Competitiveness Council (NCC) Annual Report. The report suggests that soaring house prices and rising rents could damage Ireland’s competitiveness. Link to NCC: National Competitiveness Council. About the NCC from their website:

The National Competitiveness Council was established by Government in 1997. It reports to the Taoiseach on key competitiveness issues facing the Irish economy and offers recommendations on policy actions required to enhance Ireland’s competitive position. The NCC was established by the Government in May 1997 as part of the Partnership 2000 Agreement. The Department of Jobs, Enterprise and Innovation provides the Council with research and secretariat support.

In previous posts we noted the spike and fall-off of commencements due to the introduction of BC(A)R SI.9, with industry estimates that the new regulations may cost the consumer, taxpayer and industry €5Bn by 2020. Uncertainty and significantly increased costs due to new building regulations is continuing to be a major drag on the feasibility of many new residential developments.

The reluctance of Ireland to embrace accepted international best practice to establish a system of independent inspections and regulation for our construction sector continues to impact on our international competitiveness.

Link to 2014 NCC Annual Report: Ireland’s Competitiveness Challenge 2014

Extract from article:

________

Soaring house prices and rising rents could damage economy

Soaring house prices and rising rents could damage Ireland’s competitiveness as workers seek higher wages in a desperate rush to get on the property ladder, a leading government think-tank has warned.

The National Competitiveness Council (NCC) has also strongly urged the Government to take measures to prevent the return of another damaging property bubble.

In its annual report published today, the NCC said the rapid growth in house prices and residential rents, particularly in Dublin, “represents a potentially destabilising development”.

It said the increases could lead to “adverse knock-on consequences in terms of prices and wage expectations across the entire economy”.

The stark warning comes amid spiralling home price increases in the capital due to a lack of available housing supply.

The Central Statistics Office said last week that house prices in the capital had risen by 24pc in the past year, while across the country they were 16.3pc higher.

A national survey from property website Daft.ie showed that rents in Dublin jumped 17pc over the past year, while in Cork they rose 8pc, and in Galway by 7pc.

“Such rapid growth in property costs, allied to issues around security of tenure, can be expected to have significant adverse knock-on effects on wages and inflation,” said the NCC, whose chairman is Dr Don Thornhill.

Jack O’Connor, the leader of trade union Siptu, said recently that he expected far more pay increase demands to be served on employers next year than were made this year.

He warned it could lead to an “explosion” of claims.

“While economic recovery remains fragile and Ireland is a long way from a return to the undesirable construction boom of the mid-2000s, we must take action now to ensure that the conditions which facilitated the property bubble are not allowed to re-emerge,” cautioned the NCC.

Central Bank governor Patrick Honohan has proposed a mortgage cap that could also squeeze many first-time buyers completely out of the housing market.

But the NCC said the Government should not try to intervene in the property market with a “quick-fix” solution to boost the housing supply.

It said that experience showed it took about 18 months or more to respond to increased demand.

“Strong demand for housing already exists in Dublin and some other urban areas and demand is likely to grow over time,” it added.

In the past number of months, planning applications have been lodged by developers for major housing developments in the capital, some of them for hundreds of homes.

But Dr Thornhill said Ireland could look to the broader economic future with a “greater sense of optimism”.

However, the NCC report also said that increases in personal taxation since the start of the recession had “eroded competitiveness and incentives to work”.

“The council is concerned that hard-won competitiveness gains made since 2008 are in danger of being eroded as the economy returns to growth,” added Dr Thornhill.

Other posts of interest:

Legal perspective: consumer benefit? BC(A)R SI.9

How much would 100% independent inspections by Local Authorities cost?

BCMS Commencement Notices | Nine Months On

CSO | Construction output increased by 0.1% in Q3 2014

The € 500 million + cost of S.I.9 in 2014 | Residential Sector

SI.9 costs for a typical house

Developer makes 27% profit in 6 months: warns against state housing.

A ‘perfect storm’ for housing?

€ 5 billion | The extraordinary cost of S.I.9 self-certification by 2020

Catherine Murphy TD | Today’s Housing Promises Won’t Bear Fruit for at Least Two Years

SI.9 Cost for 2014 = 3 x Ballymun Regeneration Projects

Ronan Lyons | Regulations pushing up the costs of homes

Sunday Business Post | Karl Deeter “Building regulations – rules don’t deliver results”

CSO- Dwelling units approved down 16.6% in one year

Want to live in Dublin? | Only the wealthy need apply!

Politicians asking questions about BC(A)R SI.9 | Summary

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By BRegs Blog on 18th December 2014

Politicians asking questions about BC(A)R SI.9 | Summary

In the wake of Minister Alan Kelly’s statement that he intends to amend BC(A)R SI.9, in the following summary we list a selection of issues various politicians have tabled concerning the new building regulations.

Senator David Norris discussed the array of unintended consequences and lack of consumer protection during a Seanad Deabate on SI.105- see Senators ask Minister to Revoke SI.9 (2 of 4).

Senator Michelle Mulheirn asked questions concerning pyrite in blockwork in the home county of the Taoiseach in Mayo- see Dáil update | Pyrite in Mayo.

Stephen Donnelly TD in the Dáil asked why we have no independent inspections in the new system- Dáil: Why not an independent inspection system?.

Kevin Humphreys TD asked a number of departments and Ministers responsible if costs associated with SI.9 on capital expenditure been examined- see The Cost Impact of Building Control (Amendment) Regulation (SI.9 of 2014).

Barry Cowen TD raised the considerable cost to house-building form the new regulations- Minister urges draughtsmen to register for BC(A)R SI.9.

Eoghan Murphy TD came back to the lack of consumer protections under the new system- TD’s suggest independent local authority inspectorate: BC(A)R SI.9.

Senator Cait Keane as part of an Oireachtas committee warned of the problems of a self-certification- Fine Gael expert group opposed the introduction of new regulations.

Claire Daly TD continued to champion the cause of owners with pyrite affected homes- Dáil : Pyrite Remediation Programme: 10th June 2014.

Senator Paschal Mooney was responsible for tabling a Seanad Debate on the unintended ban on self-building which still is relevant today- Senator Paschal Mooney, Minister Hogan and Seanad debate.

Mick Wallace TD who knows the construction industry better than anyone in Leinster  House warned that..

“… the major problem is that all along, the Construction Industry Federation and not the State appears to determine what is happening…The Minister’s system of assigned certifiers will crack up within the next couple of years” 

See post: Dáil debates: Mick Wallace and Minister Hogan- Pyrite

Other Posts of interest:

‘Onerous’ Building Regulations must be amended – Minister Kelly

3 County Councils ask Minister to Revoke SI.9 

Senators ask Minister to Revoke SI.9 (2 of 4)

Revoke S.I.9 – Fine Gael internal report to Phil Hogan in 2013 (3 of 4)

Going through the motions at speed – Independent.ie

Press piece: Co Council votes to scrap BC(A)R S.I. 9

S.I. 9 | Self-builders – 6 months’ update 

Press Piece: Fingal Councillors call to end BC(A)R SI.9 

SI.9 “each phase should be designed to stand alone” | BCMS

Half_price

The following email question to, and answer from the Building Control Management System (BCMS) was sent to us by a registered professional on the 11th December 2014.

The BCMS confirm that ” each phase of the development must be compliant and not have outstanding compliances in other phases even if this requires completing all the development works in advance”.

The BCMS clarification  suggests that completion of larger mixed-use projects and multi-unit residential schemes may be more onerous than was realised under the new regulations. Financing of larger projects frequently depends on early phases being complete and sold on, while later stages and some common areas, basements, roads and drainage may still be under construction. BReg Blog notes shown [ ]:

________

[Dear BCMS]

The Code of Practice says that phased completions are possible.

Does the BCMS Commencement Notice have to be done as ‘one per house’ so that there can be separate Completion Certs for each house?

Or

If it’s ‘one per estate’ for Commencement Notices (see RIAI advice) can you you then just submit separate Completion Certs for each house under the one Commencement Notice?  If so is the Register set up for this?

What is an ‘overall’ Completion Cert for the development (see RIAI advice) and what will this cover?

Is it the same for apartments?

RIAI advice says:

How will the Commencement Notice work for a Housing Estate of 100 Houses?

A.: One Commencement Notice to be issued, if all the houses are to be built together. If not then a number of Commencement Notices will have to be issued for each phase.

100 Completion Certificates will have to be issued; one for each house as completed, and then one for overall development/ external work.

localgov1localgov2

_________

Reply from BCMS, Date: 11 December 2014

Subject: Certificate of Compliance on Completion-Phased Completion Considerations

S. I. 9 of 2014 (9) A Certificate of Compliance on Completion may refer to works, buildings, including areas within a building, or developments, including phases thereof, and relevant details shall be clearly identified on the Certificate of Compliance on Completion itself, and subject to validation in line with the requirements at paragraphs (3) and (4), on the register.

Overview;

As a general rule the purpose of the Certificate of purpose of the Certificate of Compliance on Completion is to required for compliance with the;

  1. Administrative requirements as set out in the Building Control Regulations which is basically 3(a), (b)(i)  and the
  2. Design requirements 3(b)(ii) i.e. the requirements of the Second Schedule to the Building Regulations before
  3. Works or buildings can be opened, occupied or used

Therefore it is recommended that any phasing of developments for the purpose of Certificate of Compliance on Completion Certificates should be carefully considered in the context of interdependency of the Parts A-M with each other and the other phases in the development.

For the purpose of best practice housing development and construction compliance each phase should be designed to stand alone and as such compliance with Part A-M should be addressed both individually and collectively.

In essence each phase of the development must be compliant and not have outstanding compliances in other phases even if this requires completing all the development works in advance i.e. Part B access for fire appliances, Part H treatment systems, Part M access and use, Part L, J there may be district heating etc. in general each phase must stand alone and should be assessed on its merits; best method is to audit the phase against the particular requirements of the Building Regulations, a consolidated summary is set out below for ease of reference

Reference is made to the requirements of the Building Control Regulations the relevant section which is set out below;

“Building Control Regulations 1997-2014-Part IIIC – Certificate of Compliance on Completion

20F (1) Subject to paragraph (2), a Certificate of Compliance on Completion shall be submitted to a building control authority and relevant particulars thereof shall be included on the Register maintained under Part IV before works or a building to which Part II or Part IIIA applies may be opened, occupied or used.

(2) The requirement for a Certificate of Compliance on Completion shall apply to the following works and buildings –

(a) the design and construction of a new dwelling,

(b) an extension to a dwelling involving a total floor area greater than 40 square meters,

(c) works to which Part III applies.

(3) A Certificate of Compliance on Completion shall be –

in the form specified for that purpose in the Sixth Schedule, and

(b) accompanied by such plans, calculations, specifications and particulars as are necessary to outline how the works or building as completed –

(i) differs from the plans, calculations, specifications and particulars submitted for the purposes of Article 9(1)(b)(i) or Article 20A(2)(a)(ii) as appropriate (to be listed and included at the Annex to the Certificate of Compliance on Completion), and

(ii) complies with the requirements of the Second Schedule to the Building Regulations, and

[Part A — Structure; Part B—Fire Safety; Part C—Site preparation and resistance to moisture; Part D—Materials and workmanship; Part E—Sound; Part F—Ventilation; Part G—Hygiene;

Part H—Drainage and waste water disposal; Part J—Heat producing appliances; Part K—Stairways, ladders, ramps and guards; Part L—Conservation of fuel and energy; Part M—Access for disabled people]

(c) accompanied by the Inspection Plan as implemented by the Assigned Certifier in accordance with the Code of Practice referred to under article 20G(1) or a suitable equivalent.

Other posts of interest:

Have residential Completion Certificates been fully considered?

Completion Certificates for Multi-unit Housing

BCMS Completion Stage | No Ancillary Certificates required!

SI.9 causing major delays to school projects

SI.9 completion stage and the BCMS | Clouds are gathering!

5 Tips for Completion Certs

Press: RIAI fearful Local Authorities will start “finding something to invalidate as a method of workload control”

Build in 8 hours, wait 3 weeks for a Completion Cert!

Practical Post 19: Phased completion & BC(A)R SI.9 

Are Local Authorities ready? Industry concern for completion stage: BC(A)R SI.9 of 2014

Should the Architectural Technology Profession stay within the RIAI? | Liam Innes

Architectural_program-page-graphics-700x275_3

The following comment was sent to the BRegs Blog by Liam Innes and it has been formatted into a post. Liam Innes is one of two candidates on the ballot to be the Architectural Technologist member of the RIAI Council 2015.

I read with interest Joe Byrnes’ article and first of all let me say that it is regrettable that both Joe and Darren Bergin, the AT representative on Council, felt they had no option but to resign their positions within the RIAI. I can understand their reasons and Joe’s exasperation is there for all to see in the written word. Having worked with both over the last year as a member of the ATC I have seen at first hand their dedication and passion for the cause.

Going forward however, and many may think me naive, I feel that there still exists an opportunity to achieve recognition for the Architectural Technologist as a co professional with the competencies to carry out the duties of Design / Assigned Certifier as laid down in the BC(A)R legislation and for this to be promoted as part of any review of SI 9. This is only part of the story however. We also need to advance the overall standing of the Technologist within the RIAI and provide a platform for more inclusive engagement with the Institute.

My continuing optimism and involvement in the process, is based on the potential review of SI.9, and the possible submission that the RIAI Steering Group may make to any such review. The role of the Technologist must be part of this submission with recognition, and promotion of, their role as a registered professional within the legislative framework of a revised SI. 9.

While the Department of the Environment seem to have accepted the principle of the establishment of a Statutory Register for Technologists, continued pressure is required to effectively get this over the line with work required in the QQI in relation to standards in the AT field and the formulation of accession routes to a register.

The question has been asked;’ Why would technologists seek to undertake a role which is viewed by many as an uninsurable risk’. It is a legitimate question and I would think that there are many technologists currently in salaried employment who feel no need to become involved in the process. There are Technologists, however, whether by choice or as a fall out from the recession, who are running small mostly one man practices.The introduction of BC(A)R and the omission of the Technologist from the first tier of the framework has presented a serious problem for those Technologists who have been offering a full service in line with their professional competencies and who now have to explain to their clients why the service they offered on 28th February 2014 is now compromised by the implementation of BC(A)R on the 1st March 2014 yet their competencies remain unchanged. In many cases it is a basic as this.

There is a principle at stake here for many Technologists. It is one where they would like to be in a position to have the opportunity to decide, as many Architects are doing, whether they should provide the Design / Assigned Certifier service with all its associated risks. With most clients expecting a continuation of the full service the only realistic option currently available to Technologists is to join another professional institute and go down the Building Surveyor route which many are doing. This is not to denigrate the other professional bodies but many would say that the Architectural Technology Profession in Ireland should sit within the body of the RIAI but with their own identity and now is the time to settle this once and for all.

RIAI + Architectural Technologists | Malachy Mathews

CIAT + Architectural Technologists | Michael Quirke

Dáil | Architectural Technologist update

Architectural Technologists: Are you on the right bus?

CIAT Architectural Technologists Register goes live today!

Dáil: CIAT & RIAI- 2 Architectural Technologist Registers

Dáil: response on Architectural Technologist Register in 7 days

UPDATE- CIAT Register for Architectural Technologists in Ireland

Dáil TD’s want to Revoke SI.9 (4 of 4)

Architectural Technologists + Architects | Parity of Esteem?

Hot topic: Architectural Technologists and SI.9

Thoughts on a Register for Architectural Technologists

Architectural Technologists and BC(A)R SI.9: CIAT

Architectural Technologist – Platitudes, Head Nodding and BC(A)R SI.9.

RIAI NEWS ALERT: Architectural Technologist Register

Message from Mick Wallace TD to Architectural Technologists

Audio Clip: Dáil Debate 27th May- Architectural Technologists & SI.9 

BCMS Commencement Notices | Nine Months On

hand-9-nine

Stop! – SI.Nine is 9 months old

The 9th monthly Building Register was published by the Building Control Management System (BCMS) on 4th December 2014 at 8.08 a.m. The Building Register records all of the validated Commencement Notices or ‘proposed building starts’ received by the 34 Building Control Authorities throughout Ireland.

The Building Register now records a figure of 4,294 as the total number of validated Commencement Notices received over the past nine months (39 weeks) since the introduction of the BCMS on 1st March 2014.

Of these 874 (20%) are Commencement Notices without accompanying SI.9 documentation (aka Short Form) and 260 (6%) are seven-day notices (Fire Safety Certificates). These percentages remain consistent since the six month results published in October.

Since the introduction of the BCMS, the average number of commencement notices being lodged is 110 per week. However in 2013 the average number lodged per week was 143 (7,456 in total).

Currently commencement notices are running 25% below 2013 levels which was an historic low point in construction industry output. These figures are borne out by the latest information from the CSO which records that Building and Construction output only grew by 0.1% in the third quarter 2014.

Link to Building Register: 

Other posts of interest:

A ‘perfect storm’ for housing? 

Karl Whelan: “…raft of cost-increasing building regs are at least partly responsible”

FAO Committee on Environment, Culture and the Gaeltacht- commencement figures

Commencement Notices | 6 months after S.I. 9 

Construction Recovery- watch this space

‘Recovery’ is Still Worse than the 1980s Crisis

CSO: (Q1 2014) planning permissions for dwellings -30% drop

Minister Hogan rejects Irish Times Article

Irish Times: Dramatic fall in number of buildings being started

 

CSO | Construction output increased by 0.1% in Q3 2014

champagne-1262279028

Recent data issued by the Central Statics Office suggests recent media coverage and speculation of a construction boom may be premature. With only a 5.2% increase in residential output expect supply issues to continue to distort the market. Don’t break open the champagne yet. Extract off CSO site to follow. For direct link click here.

____________

CSO statistical release, 11 December 2014, 11am

Production in Building and Construction Index

cso1.pdf [Converted]

Building and Construction Output increased by 0.1% in 3rd quarter 2014

cso 2a

The volume of output in building and construction increased by 0.1% in the third quarter of 2014 when compared with the preceding period.

This reflects increases of 5.2% and 0.1% in residential building work and civil engineering respectively while there was a decrease of 1.0% in the volume of non-residential building*.  The change in the value of production for all building and construction was +1.3%. See tables 1(a), 1(c), 2(a), 2(b) and graph. 

On an annual basis, the volume of output in building and construction increased by 10.1% in the third quarter of 2014*.  There was an increase of 11.0% in the value of production in the same period. See table 1(a).  The annual rise in the volume of output reflects year-on-year increases of 19.1%, 13.4% and 2.5% respectively in residential building work, civil engineering and non-residential building work.   See tables 1(c), 2(a), 2(b) and graph.

*Given the unprecedented low base this series is starting from, the CSO will continue to monitor the quality and comparability of this new data series.

cso 3.pdf [Converted]

Other posts of interest:

SI.9 stops Summer Works for schools in 2015!

Pyrite legal dispute referred to European Court | Independent

SI.9 causing major delays to school projects

SI.9 Cost for 2014 = 3 x Ballymun Regeneration Projects

Ronan Lyons | Regulations pushing up the costs of homes

Sunday Business Post | Karl Deeter “Building regulations – rules don’t deliver results”

CSO- Dwelling units approved down 16.6% in one year

World Bank Report 2015 | Ireland’s poor construction regulations are the biggest drag on our ranking

Residential construction down in 2014 Q1+ Q2: (CSO statistics)

PII Insurance increase under SI.9 with no cover for pyrite?

personal-insurance

BRegs Blog admin 13th December 2014

Following the Minister’s warning to professionals on fees, he’s also sent a clear signal that those responsible for defective construction products will be pursued under the new building control regime… (Muscovite Mica). Minister Alan Kelly:

the people who ensured young families would be left in this manner must be followed to the end“.

See Minister Kelly’s comments here.

All Certifiers should take note. We wonder how could an Assigned Certifier possibly know the chemical composition of blocks? Even the Pyrite Panel said this would be impossible. It would seem that all Professionals’ insurance policies exclude pyrite, and are set to increase due to increased liability under BC(A)R SI.9.

Correspondence from a Professional Insurance provider to a contributor in December 2014 illustrate the problem (extracts to follow):

Dear BReg Blog,

I asked a Professional Indemnity Insurance provider the following questions. I would suggest you get your readers to do likewise:

  1. Is there any discount or loading for new certifier duties under BC(A)R SI.9?
  2. I was wondering what standard levels of cover do you provide for sole traders, do you cover pyrite?

This is the reply I received:

I believe most of the insurers apply a pyrite exclusion, sample wording below for your review;

“The Underwriters shall not be liable to indemnify any Insured or to make any payment under this Policy in respect of any Claim, Loss, liability or Defence Costs arising out of, caused by, resulting from, in consequence of, in connection with or in any way involving any of the following:

 22. PYRITE/CONTAMINATED INFILL

any presence or alleged presence of any products or material containing or alleged to contain any form of pyrite, iron sulphite or their derivatives or any contaminated infill material.”

In relation to the new assigned certifier role, I do not think any insurer is awarding discounts for the new role, if anything they are loading their rates for the additional responsibility/exposure taken on. Our main market is keeping their rates static which seems to compare favourably.

We wonder where this leaves consumers, given that Local Authorities still have not increased resources to police the construction materials sector. Certifiers are now responsible for certifying materials (Part D) but are not insured for pyrite in projects.

This may cause some uncomfortable questions by registered professionals, who have consistently been told by their representative bodies that Professional Insurance won’t increase. More worrying is if a certifier is found liable for signing off on pyrite and there is no insurance cover for the claim.

Sounds familiar.

Other posts of interest:

Pyrite legal dispute referred to European Court | Independent 

S.I. 9 and Insurance Claims: Deirdre Lennon MRIAI

“The insurance will sort it out…”

What is PI Insurance? 

Pyrite: the spiraling cost of no Local Authority Inspections

Are Design and Assigned Certifiers risking professional suicide with Pyrite and S.I.9?

Pyrite & SI.9- what happens now?

RTÉ News: Louth housing scheme to be demolished over pyrite

Dáil : Pyrite Remediation Programme: 10th June 2014

Government Reports & Professional Opinion Ignored in S.I.80

Clear and auditable trail: consumer protection? BC(A)R SI.9

HomeBond ‘snub’ over pyrite ‘a matter of serious public concern’ – Committee

SI.9 Review.. “early in the new year” | Minster Alan Kelly

Dublin_Custom_House

BRegs Blog 13th December 2014

Minster Kelly SI.9 Review.. “early in the new year”

In the following Dáil exchange Brendan Griffin (FG TD) asked Minister Alan Kelly if he intended to revoke SI.9. Minister Kelly responded that he had “…no plans to revoke the Building Control (Amendment) Regulations 2014”.

However Minister Kelly gave a strong indication that the 12-month formal industry review confirmed by industry stakeholders for March 2015 would be brought forward to earlier in the new year. We assume this is a result of weaker than expected economic indicators from the construction sector, a fall-off in house building and delays to capital projects since 1 March. We believe both Minister Kelly and Minister Coffey have received strong representations from self-builders, consumer groups, concerned professionals and BRegs Blog contributors.

The BRegs Blog would like to invite readers for feedback, as a number of contributors are researching and preparing a formal report on this at the moment. We welcome broad input and feedback from industry and economic commentators, policy advisors and consumers in order to be able to give the Minister a full unbiased picture of the impact of the new regulations that is unencumbered by legacy issues through involvement in the negotiations to bring about SI.9.

If any groups have made contributions to the Ministers in their ongoing review process we would we would be glad to receive your contributions. Email: bregsforum@gmail.com

Link to Dáil exchange here.

Extract:

Department of Environment, Community and Local Government

Building Regulations Amendments Tuesday, 2 December 2014

Brendan Griffin (Kerry South, Fine Gael)

539. To ask the Minister for Environment, Community and Local Government if the Building Control (Amendment) Regulations 2014, SI 9, will be revoked; and if he will make a statement on the matter. [46099/14]

Alan Kelly (Tipperary North, Labour)

I have no plans to revoke the Building Control (Amendment) Regulations 2014. Over 4,700 new construction projects have been notified to Building Control Authorities across the local government sector since these regulations came into operation on 1 March 2014. Evidence to date suggests that the Construction industry is responding well to the new regulatory framework. Oversight of activity by industry and by local building control authorities has improved immeasurably and authorities have ready access to detailed data on projects via the online Building Control Management System. The online system streamlines building control administration and enables authorities to identify risks and track progress.

A Framework for Building Control Authorities was adopted by the City and County Management Association on 17 July 2014 – these common protocols add clarity, efficiency and consistency to building control activities across the local government sector.

I am satisfied that this key reform of the regulatory framework represents a reasonable and appropriate response to the many building failures that occurred in the past decade and will lead to improved quality within the construction sector. My Department will continue to work closely with local authorities, industry stakeholders and members of the public generally to ensure that all concerned understand their obligations under the regulations and how they can comply with these in practice. A review of the first year of operation of the regulations will be undertaken by my Department in conjunction with local authorities and industry stakeholders. The review will commence early in the New Year and will inform future regulation in this critical area.

Other posts of interest:

SI.9 | Where’s the accountability?

Dáil | Minister Kelly may take steps to control SI.9 ‘exorbitant charges’

‘Onerous’ Building Regulations must be amended – Minister Kelly

Revoke SI.9 | IAOSB / Self-Builders’ Letter to TD’s

SI.9 causing major delays to school projects

SI.9 Cost for 2014 = 3 x Ballymun Regeneration Projects

Iaosb letter to Minister Kelly – Revoke or Revise S.I.9