This morning I read a very interesting article from the Irish times by Niamh Towey – “Why can’t small-scale builders build in a housing crisis when demand for homes is soaring?” See here – Irish Times
Since the article is behind a paywall, I will summarise it below as best as I can.
Core Focus of the Article
Despite soaring demand for homes in Ireland, small and medium-sized builders (SMEs) continue to face structural and bureaucratic barriers that prevent them from delivering new housing.
Niamh, in my humble opinion, does an incredible job of getting real-time testimonies and perspectives from SMEs that are directly affected. The article also outlines systemic issues affecting housing supply from smaller players in the construction sector.
Key Highlights
1. Long Planning Delays
- Example – Developer Anthony Neville has been trying since 2004 to build 345 homes in Co Kildare. After 21 years, the project still hasn’t gone ahead due to planning delays, with land zoning and local authority objections stalling the process.
- The process is described as “incomprehensibly slow”, even with full technical plans, infrastructure commitments, and available land. Though large developers like Cairn & Glenveagh also experience delays, they are never anywhere near as long as 20+years.
2. Access to Finance is Severely Limited
- Banks are reluctant to lend to small developers due to perceived risk. Banks also aim to reduce perceived exposure after harsh lessons learned from the 2008 housing crisis.
- High upfront costs and the absence of finance for “soft costs” like planning fees, consultancy, and site prep restrict small builder capacity.
3. Infrastructure & Utility Challenges
- Even when planning permission is secured by small and medium developers, they still face delays in accessing basic utilities like water, electricity, and roads.
- Irish Water and the ESB have been cited as “slow to act”, further delaying build commencement.
4. Policy Favouritism Towards Larger Developers
- State schemes such as Project Tosaigh and Croí Cónaithe are often geared toward large-scale institutional developers.
Project Tosaigh is a government initiative that takes on/or funds stalled housing projects in order to accelerate the supply of affordable housing. This could include the Land Development Agency (LDA) agreeing to buy homes upon completion, thereby allowing housebuilders to begin or accelerate their development.
The Croí Cónaithe (Cities) Scheme is a fund to support the building of apartments for sale to owner-occupiers.
- SME builders feel excluded from housing initiatives despite being much better placed to develop smaller sites in regional and rural areas.
5. Underutilised Capacity
- Ireland has many small building companies capable of delivering 10-30 units per year, which could cumulatively have a big impact.
- However, systemic planning and the fact that banks don’t want to lend to them hampers the ability of these businesses to scale.
6. Risk of Losing Skilled Labour
- With many smaller firms unable to keep business flowing during times of high inflation, Irish craftsmen and construction workers are migrating to countries like Australia and Canada, where the environment is more favourable.
- There is concern that this brain drain will erode the already limited construction labour force in Ireland.
📊 Summary Table – Challenges Faced by Small Builders in Ireland
| Challenge | Impact on Small & Medium Sized Builders |
|---|---|
| Delayed planning permissions | Ties up land and capital for years; discourages investment |
| Poor access to finance | Limits project starts, especially for upfront costs |
| Utility connection delays | Post-planning build start delays |
| Government policy bias | Funding and support favours large institutional developers |
| Labour retention issues | Loss of skilled workers to other countries |
What the Irish Government Could Do to Empower Small Builders.
A. Simplify Planning Processes
- Fast-track approvals for developments under a certain size. For example, maybe 10-30 units, especially in rural and regional areas.
- Create a dedicated small-developer support desk within the Housing Department or local planning authorities for SME queries. (Maybe that already exists but I haven’t found anything during my research).
- Allow rolling rezoning windows (not just every 5 years) – to prevent unnecessary delays in zoning viable land. Is this a power that the new housing czar should be granted?
B. Improve Access to Development Finance
- Establish a form of State-backed loan guarantee scheme to encourage banks to lend to smaller developers.
- Introduce low-interest construction loans through agencies like the Housing Finance Agency (HFA) or Strategic Banking Corporation of Ireland (SBCI).
- Provide grants or pre-development funding for feasibility studies and planning applications.
C. Tackle Public Infrastructure Bottlenecks
- Mandate time-bound commitments from Irish Water, TFI and ESB for utility connections on pre-approved sites.
Now this is highly unlikely. Our ENTIRE way of life in Ireland depends on Irish Water, transport and ESB operating on a subconscious/fundamental level. Most of us have no idea what it takes to keep these services running everyday. We simply expect them to work… and they do. Mostly.
So if the public is not actively involved in pressuring the government to prioritise utilities for SME developers, then nothing will change. It’s just that simple.
D. Open Up Government Housing Schemes
- Allow SME builders to access schemes like Project Tosaigh and Croí Cónaithe above.
- Encourage Approved Housing Bodies (AHBs) to partner with local builders to deliver small-scale developments.
How Modular Homes Can Help Solve the Problem – If Government Plays Its Part.
What Is Modular Housing?
Modular housing refers to factory-built homes constructed into ‘modules or sections’ off-site and then later assembled on-site.
It significantly reduces construction timelines and is particularly suited for small infill sites or phased developments — exactly the type of land many small builders already control.
Why Modular Makes Sense.
| Advantage | Impact on Small Builders |
|---|---|
| Shorter build time (weeks vs. months) | Faster turnover = better cash flow and reduced risk |
| Predictable costs | Easier to reduce budget overruns / Difficult to access finance in Ireland |
| Off-site construction | Less dependency on scarce local labour |
| Flexible sizing | Ideal for small plots, rural builds, or urban backland sites |
What the Government Can Do to Boost Modular Adoption
- Incentivise SMEs that have already adopted modular techniques via grants or VAT relief.
- Fast-track planning permission for modular projects that meet performance and energy standards.
- Support training and certification in modular construction for local builders and trades.
- Include modular homes in public procurement schemes for social, cost-rental, and affordable housing developments.
A Clear Path Forward
With modular homes already gaining traction in countries like Portugal, Ireland risks falling behind. However, the demand is here — especially if modular systems are paired with smarter planning, inclusive public schemes, and targeted financing.
Ireland’s small builders are ready to work. Modular construction is ready to deliver. All that’s missing is the political will to empower the people who can help solve this crisis at scale.
FINAL THOUGHTS
By combining policy reform and modular innovation, the Irish government has the tools to unleash a new wave of small-scale housing — faster, more affordable, and more sustainable.
The future of housing may not lie in just one big solution, but rather in hundreds of smaller ones built across the country by the very small and medium developers now locked out of the system.
