This morning the ‘National Housing Construction Index’ was published and posted on the website. The report created some excellent publicity for the link2plans website (including on Morning Ireland) which is primarily a commercial endeavour targeted at selling a monitoring service to the construction sector.

So what does this latest report tell us? Predictably over the period 2011 – 2102 there has been a sharp drop in planning applications nationally with the largest falls in Kildare (-41%), Kerry (-39%), Clare (-35%) , Mayo and Louth (-31%). Dublin and Sligo recorded the lowest drop – down just 2%.

However, from a planning and development perspective these figures tell us very little. The index measures planning applications and commencement notices but does not measure the number of dwelling units, commercial floorspace, retail units etc in each, i.e the quantum and type of development. In the case of planning applications, the report also does not tell us whether these were granted or refused planning permission.

A quick look at the link2plans home page points to the real story behind the figures – the majority of new planning permissions/commencement notices are for ‘self-build’ projects, i.e. one-off dwellings. Given the overhang in vacant properties and the insolvent state of the property development sector, financing multi-unit residential development is currently impossible (and foolhardy). Similar to the 1980’s, the only projects which are likely to proceed are those which are easier to finance and with a specified end-user. In fact, the more useful CSO figures last month show one-off houses accounted for 64.1% of all new dwelling units granted planning permission in Quarter 1 2012. In this quarter there was a corresponding decrease of 58.9% and 84.5% in planning permissions granted for multi-unit housing and apartment developments respectively.

The CSO data shows that planning permissions for new dwellings in rural counties are significantly ahead of urban areas and this is also evident in the ‘National Housing Construction Index’. This trend towards counter-urbanisation and housing leakage is storing up serious policy difficulties in terms of implementing the National Spatial Strategy, reducing car dependency, protecting NAMA assets and maximising efficient public investment in infrastructure together with creating sufficient agglomerations of scale to stimulate new employment creation. The average size of a one-off house granted planning permission in Q1 2012 was 2,660 square feet (larger than 2006/2007) which further points to some significant social equity issues.

Economic recovery requires proactive spatial planning. Without reference to the type of development and where it is occurring, a crude measurement of planning permissions and commencement notices tells us very little. While, on paper, planning reforms in recent years have been very significant, there is little evidence that these reforms are being translated on the ground.

Gavin Daly