MARKET ANALYSIS:TENDER PRICES for new-build projects costing more than €500,000 fell steadily during 2007, with a steeper fall recorded in the second half of the year.
The findings are published in a Society of Chartered Surveyors (SCS) study.
Since 1998, the SCS has conducted biannual Tender Price Index reports.
The latest index is for the second half of 2007 and reinforces what other studies have shown, according to the SCS's president, Sean McCormack of DTZ Sherry FitzGerald.
"This latest research on tender prices confirms all reports in the industry. These findings reflect the well publicised slowdown in new residential construction and the consequent increase in capacity for the rest of the industry," he says.
Tender prices were down by about 4.3 per cent over the full year, with a more rapid decline in the second half of 2007, according to the findings.
"Prices are particularly competitive at present as both main contractors and specialist sub-contractors seek to replenish their order books to allow them retain key staff until the market improves," McCormack says.
The SCS sets its index against a base of 100.0 set in the first half of 1998.
The figures show that in the first half of 2007 the index stood at 152.0 and at 145.2 for the second half.
The comparable figures for 2006 were 146.7 for the first half and 151.7 for the second half of that year.
The index is based on actual tender returns for non-residential projects, and is predominated by new-build projects with values over €500,000.
Prepared by the SCS's Quantity Surveying Division, it covers all regions of Ireland and represents a good measure of average construction tender prices across different project types and locations.
The SCS describes its index report as "the only independent assessment of construction tender prices in Ireland".
The SCS warns that the index should only be used as a guide when looking at any particular project given pricing will vary depending on factors such as complexity of the project, location, timescale and so forth.
