Republic of Ireland market intelligence: Inflationary pressures ease
The Irish construction industry has seen further disruption over the past year. Further increases in construction costs accompanied by rising interest rates, have been reflected in the cooling of new project starts and a decrease in construction output.
Despite the challenging market conditions, our latest Republic of Ireland market intelligence survey indicates that the forecast is looking more favourable, with output in some sectors improving, and tendering conditions cooling.
Market conditions reaching a plateau
The current market sentiment is that tendering conditions are plateauing, with contractors noting a reduction in tendering activity and with that an increase in the levels of competition.
The previous 12 months to Q4 2022, the volume of building and construction output in the Republic of Ireland decreased by -11 percent in the year and -3.1 percent in the last quarter."
If inflationary pressures ease towards the end of 2023, the Republic of Ireland’s construction industry should hopefully see increased volumes of activity.
Residential remains a top performing sector
With housing a top focus for the Government, residential development remains strong. It is encouraging to see residential output return to growth in the last quarter, albeit at a modest 1.8 percent. Residential was also called out as the top-performing sector by 33 percent of the respondents, although this has fallen from the previous survey’s 57 percent.
Public works has stepped up to join residential as the joint top-performing, also with 33 percent of the response. This is up from 14 percent from six months ago.
The private commercial sector increased back up to 22 percent having fallen to 14.3 percent six months ago, reflecting the changing market with the fall away of tech sector demand being replaced by the professional services and banking sectors.
For the full analysis and insight into the Republic of Ireland construction industry, access the full report.
If you would like to discuss this report or any of the topics covered, please contact Philip Matthews, or your usual Turner & Townsend key contact.