Government-backed lender Home Building Finance Ireland (HBFI) has approved €3.8 billion in loans for residential construction, marking a 14% increase from the €3.2 billion recorded at the end of December as the State continues efforts to boost housing supply.
According to HBFI’s latest report, the approved funding is expected to support the delivery of 19,399 homes across Ireland. More than 8,000 of those homes have already been sold, highlighting steady progress in projects financed by the lender since its establishment in 2019.
HBFI was created by the Government to provide an additional source of funding for residential developers, particularly where access to traditional finance is limited.
Speaking to RTÉ’s Morning Ireland, HBFI Chief Executive Dara Deering said the organisation’s funding is primarily helping deliver homes for owner-occupiers, while demand is also growing for social, affordable and rental housing projects.
“The homes that we’re funding are primarily for owner occupiers, but we’re also seeing demand for social and affordable homes, and indeed for the rental sector,” Deering said.
Small and medium-sized builders continue to account for the majority of HBFI’s lending activity. Around 80% of all funding approvals have been for loans valued at less than €20 million, reflecting the lender’s focus on supporting smaller developers.
An HBFI report published in April found that Ireland’s homebuilding sector remains highly fragmented, with about 90% of small housebuilders constructing fewer than 50 homes annually.
Deering said the industry has traditionally relied on small and medium-sized builders, even during periods when housing output was significantly higher.
She said HBFI has developed a clearer understanding of builders’ capacity, regional presence and financing requirements, allowing it to provide funding that can help companies expand their operations.
While the funding has supported a broad mix of housing developments, apartment construction remains a relatively small share of the overall portfolio. Only 30% of the homes backed by HBFI financing are apartments.
Deering said apartment projects have faced financial viability challenges in recent years, slowing the pace of new developments across the country.
She expressed optimism that recently introduced Government initiatives aimed at encouraging apartment construction would improve conditions for developers and lead to increased building activity over the coming years.
“I think you will see an increase in apartment delivery over the next number of years and we absolutely have a specific product for apartments, so we will support house builders if that’s part of their plans,” she said.
The latest figures suggest State-backed financing continues to play an important role in expanding Ireland’s housing pipeline, particularly by providing capital to smaller builders responsible for a significant share of new residential development.
You must be logged in to post a comment Login