Slowing of Building Development

The rate of development in Ireland’s construction sector has slowed to an all time low in June spanning across the last 8 months. Although the rate of expansion is declining, the construction sector remains at a solid growth rate.

The declining growth was caused by the weaker activity in the civil an commercial segments. This contrasts the housebuilding sector that according to the Ulster Bank Construction Purchasing Managers’ Index displays signs of constant and strong expansion.

The construction index amounted to 53.1 for the month of June, 2019. This number decreased from May amounting to 54.9. The index defines that any number above 50 indicates expansion in the construction sector. Any readings below 50 indicate contraction.

Simon Barry, Ulster Bank’s chief economist for the Republic of Ireland, claimed that although commercial activity is still expanding, the decline in pace of expansion in June reached the weakest expansion rate in six years. This trend of declining construction expansion rates denotes that the housing crisis is far from being solved. The amount of construction needed to meet demand falls far below current …

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Rate of expansion in construction activity slowed in June

In June, the rate of expansion in construction activity slowed in Ireland. The civil engineering division had a slight decrease while the housing and commercial divisions remained strong.

The latest Ulster Bank Construction Purchasing Managers’ Index (PMI) showed construction activity went from 63.6 percent in May down to 58.2 percent in June. However, if it is above 50 percent then that means the sector is growing.

Housing activity sector of the index went from 69.2 percent in May to 59.5 percent in June. Commercial activity reads at 60.8 percent in June from 65.2 percent in May. Civil engineering dropping from 51.8 percent in May to 48.4 percent in June.

Despite the sector growing, it still has not hit the target level of 25,000 new housing units every year, according to the Economic and Social Research Institute. Last year, the Department of Housing estimated a total of …

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