The headline seasonally adjusted BNP Paribas Real Estate Ireland Construction Total Activity Index posted just fractionally below the 50.0 no-change mark at 49.9 in July.
The reading was up from 47.5 in June and signalled a near-stabilisation of activity.Housing activity increased for the fifth consecutive month, and at a solid pace that was the fastest since April.
Meanwhile, commercial activity was broadly unchanged following a sharp reduction in June.A key positive from the latest survey was a marked expansion in new orders which was the sharpest since February 2022.
New business has now risen in five successive months.Companies responded to higher workloads by taking on additional staff, the eighth consecutive month in whichthis has been the case.
That said, the rate of job creation was only marginal and the softest in the current sequence of rising employment.Firms also expanded their purchasing activity, both in response to higher new orders and to replenish stocks.
The solid increase in input buying was the fastest in 28 months.Input costs meanwhile rose sharply, with the pace of inflation remaining above the series average despite easing slightly from that seen in June.
Commenting on the latest survey results, John McCartney, Director & Head of Research at BNP ParibasReal Estate Ireland, said:
“July was another positive month for residential construction with activity expanding for the fifth month in succession – the first time this has happened in over two years.Looking at the mid-term report card, new dwelling completions fell by 8.6% in H1. This means 20,700 units need to be delivered in the second half for the Government’s target of 33,450 completions to be met - an 11% increase over H2 2023. Given that the number of units under construction in Dublin was down 13%year-on-year as we entered 2024, this would appear to be quite challenging. Nonetheless, commencements have picked-up sharply in recent months and the increased activity indicated by the PMI points to stronger output ahead – although it may be 2025 before the recent surge in early-stage construction yields a material uplift in completions.”
