One million starts in the US?

Stunning from Morgan Stanley - consider we built about 90,000 last year.

Given that our population is 1.3% of the USA, this would be equivalent to less than 13,333 housing starts in Ireland. Obviously we are talking about two different markets here but let’s say that hypothetically something similar happened in Ireland in 2009, what would that do to our (already weakened by then I would suspect) GDP numbers?

All other things being equal 13k starts next year would put the economy into recession at -3 to -4pc!

Except all other things wouldn’t be equal - the disappearance from that amount of secondary spending would cripple everything from the material suppliers and EAs to the motor trade and breakfast roll makers.

The -3 to 4pc figure takes into account the multiplier effects of the collapse of that level of spending and investment in the economy. All other things being equal refers to the remainder of the economy not impacted by a building sector collapse.

Do you think?

Halving construction overall (which is roughly what that number would mean) would remove a minimum of 12% of GDP in construction and related industries (since construction and related sectors account for about 25% of GDP currently) - the wider effects on internal products and services which are not directly construction related could easily be as much again (since they lose a proportional number of customers).

Anyone who’s wondering what the irish economy would look like with 2000 like rates of house construction should look at the GDP figures for that year - not pretty. Most of ireland economic growth since then has been from secondary effects of the construction boom.