Homeowners have been encouraged to check that their house is adequately ensured after the latest report from the Society of Chartered Surveyors Ireland (SCSI) found that the average cost of rebuilding a home has risen by 12% in the last year.
Their latest House Rebuilding Guide shows that national average rebuild costs, which include demolition and site clearance, have increased by an average of 12% with the rate of increase broadly steady across the various regions of the country. That is less than the 21% rate of increase in the previous 12 months.
Significant variations were found, however, in the rate of rise in the cost of rebuilding different types of houses. The ongoing strong rate of rebuilding inflation is due to a shortage of construction labour and high demand for builders, SCSI said.
"Overall, the construction market is extremely busy, and this means it can be difficult to source labour or subcontractors for any type of build, particularly electrical, plumbing and heating," said Chartered Quantity Surveyor, Kevin Brady.
"Material prices have started to stabilize for certain materials, however concrete products are still experiencing price increases as are insulation products, windows, and plumbing products and these are some of the key material cost drivers."
Dublin has the highest rebuilding cost per square metre, while the north-west has the lowest.
The SCSI said the ongoing increases in the price of rebuilding underline the need for homeowners to have sufficient insurance.
"Homeowners need to ensure their house is adequately insured so that in the event of a total or partial loss situation…they are covered under their insurance policy when reinstating or rebuilding," said Mr Brady.
"For example, rebuild costs for a 3-bed-semi, the most common house type in the country have increased by circa €24,000 to €35,000 depending on where you live over the past 12 months."
"While these increases are considerable it does not necessarily mean the premium will increase on a pro-rata basis and homeowners are advised to shop around when seeking insurance cover for their homes."
The SCSI also pointed out that valuations are not the same as rebuilding costs and any under provision in insurance may require the homeowner to pay a proportion of the reinstatement costs.
The SCSI urged homeowners to take the time to calculate the correct reinstatement cost for their home using its free House Rebuilding Calculator, as the cost of rebuilding can vary based on property type and location.
The society estimated that the minimum base cost of rebuilding a three-bed semi is now €303,212 in Dublin, while the minimum base cost of rebuilding a similar house in the northwest is €225,204 — a difference of more than €78,000.
In terms of the increase in costs in the past 12 months, the rebuild cost for a three-bed semi in Dublin has increased the most, rising by €35,182 (from €268,030 to €303,212). Meanwhile, the rebuild cost for the same type of home in the northwest rose the least but still increased by €23,814 (from €201,390 to €225,204).
