Some of the main providers of social housing have said a rise in lending rates by the State's Housing and Finance Agency may impact on the volume of social housing that can be delivered.

Approved Housing Bodies were informed earlier this week that the HFA was increasing its rate on some fixed long term loans.

One social housing provider told The Irish Times that they will not be able to proceed with some projects due to the increases.

The Housing Alliance, which represents the six largest housing bodies, described the increases as significant and said it "may impact on the volume of social and affordable housing that can be delivered."

In a statement, the Alliance whose members provide almost 30,000 homes nationally, said delivery potential was already under pressure from supply chain challenges, the rising cost of building materials and labour and the lack of access to land on which to build houses.

The agency's 25 year fixed rate is increasing by a half-point to 2.25%, while the 30 year fixed rate was rising by a quarter-point to 2.5%.

But the Housing Minister has said the increase in lending rates to the main providers of social housing will not affect the future delivery of homes because government will provide the extra funding required from the housing budget.

Darragh O'Brien said he wanted to assure the Approved Housing Bodies that the government is working to rework and reappraise any future proposals that they feel may be impacted by the rate increase.

He said he was very confident that government could address any shortfall in funding and that any social homes in the pipeline "will be able to proceed."

The Minister also said government would repurpose and reappraise any future schemes to take into account this rate increase so that no future scheme is in jeopardy.

He said the HFA's rates, which are set independently of government, are still a good rate but that some developments may have been priced with the existing rates but he said "that's a reality that we have to address but we will address."

"No future scheme that is planned or where there may be some issues because of the rate increase will be stalled in any way," he said.

"We will proceed with them and we will work through with the sector in the coming weeks to ensure that that happens."

He said the Housing for All budget operated in a multi annual basis that that "we have flexibility within that."

In a statement the Housing and Finance Agency described the increases as modest and said it was due to the high volatility in bond markets and the substantial increase in Irish government bond yields over the past few months.

It says all existing drawdowns of loans will be unaffected and it said for those awaiting planning or approval the increase is so marginal that it should not affect their viability.

Economist Colm McCarthy said the increase in the HFA's rates is a manifestation of what is happening internationally.

"The Irish government would pay tomorrow about 1.8% for ten year money, that was zero about a year ago, so interest rates are on the way up and mortgage interest rates are beginning to creep up as well," he said.

"So what's happening with the Approved Housing Bodies is small so far but its a manifestation of a broader trend that's out there.

"The holiday that governments have enjoyed for cheap money, the holiday is over and there's nothing the Irish government can do about it."