“We are struggling to grow up here,” Conor Mulligan tells me.
He says a lack of land and a sluggish planning system mean Lagan Homes is expanding elsewhere – south of the border and elsewhere in the UK.
“We aren’t building enough houses here [to meet the market demand],” he says.
As a result, the Belfast-based firm has expanded its business in the Republic to around £70m in the last year, more than the £50m it’s done here.
To illustrate the planning woes he’s facing, Conor says he’s been waiting on the green light for a change of house type application – with the same number of properties and no objections – for the last two years.
“I’m waiting on a planning application for a change of house type – the same number of houses and no objections. It’s taken two years.
“When you’re in the boardroom and I’m telling people it’s taking two years for a change of house type, when the guys down south are getting planning approvals in six months – where do you put your money?”
As we stand atop a large mound of earth on an unusually hot and dry day, the last foundations, bricks and mortar are being laid on the final green-lit phase of the huge Millmount development on the outskirts of Dundonald, not far from Belfast.
“It’s also the availability of land,” he says. “This site here [Millmount] will have 600-700 houses. There will never be another site like this.”
The firm posted sales of £132.6m, according to accounts for Lagan Homes Group Ltd, for the year ending December 2022.
In that period it published pre-tax profits of £6.7m.
Lagan Homes is a company which counts construction stalwart Kevin Lagan among its directors, and is headed by Conor Mulligan.
It’s increased its standing on the Top 100 – shooting up from the 88 spot to 75 in this year’s publication.
Conor says margins are “as tight as I ever remember them”.
“We hope to do £70m [in the Republic] this year. That’s from a standing start five years ago, so incredible growth.
“That’s down to the market, which is strong, but the ability to get planning permission and the availability of land.
“We have to expand. We are doing as much work in GB as we are doing here [Northern Ireland].
“We have a good land bank and that is supported with planning, and Northern Ireland Water support, so hopefully that remains. But replacing that [work] is incredibly difficult, so that’s why we are looking at different jurisdictions.”
Conor says house prices are close to where they were during the property boom, but construction costs have doubled.
“The market tells you what you can sell them for, so you have to hope for the best,” he says.
In terms of the workforce, he says wages and costs have gone up.
He says there remains strong demand for new build properties here, with energy efficiency being one of their strengths.
“Everything reflects back to the boom,” he says. “When we were selling then, you would have rented one for £400-500. It’s now £1,200.
“People are getting squeezed, left, right and centre. We just haven’t been building enough houses.”
Looking ahead, Conor says property prices and rents “are going to continue to go up, because we haven’t been supplying enough” homes.
“I don’t see [a collapse],” he says. “We have incredible scarcity, rents are three times what they were,” he said.
“There just aren’t enough properties and the rents of the existing properties are going to get higher and higher.”
“We will probably move towards more retirement living, and the benefit of that is freeing up more houses into the community again.”