Micro-level evidence on housing supply constraints: Planning policies, uncertainty or market forces?

In this paper, we use a novel micro dataset of planning permissions, planning duration and building commencements in Ireland to test the sensitivity of housing supply timelines to a range of factors. This includes strategic planning policies, planning appeals, financial, economic and cost factors as well as differences across developer/contractor types and spatial competition effects. Our key dependent variables are: a) the time-frame from planning application to planning grant; and b) the time from planning grant to building commencement. Overall we find that the activation phases is longer than the planning phase and the planning phase timelines have remained relatively static over the sample. Activation phases have doubled in duration on average between 2017 and 2024. We find that appeals to the planning commission and requests for information lengthen planning timelines. In terms of commencement activity, we find that increases in interest rates and labour costs prolong housing starts while capacity constraints (reflected in tighter labour markets) also extend the time to commencement. Heterogeneous effects are evident across single-unit housing developments and multi-unit production.