The rising cost of construction could mean that the Government's Housing for All targets will not be met, the Society of Chartered Surveyors has warned.

In its opening statement to the Oireachtas Committee on Housing, Local Government & Heritage, the society told members that the situation is at a "pivotal point" where decisions must be made to take action in the short term.

Today's hearing was also attended by representatives from the Construction Industry Federation (CIF) and the Local Government Management Agency (LGMA).

All three organisations have given stark warnings over the impact of inflation on housing delivery over the short to medium term.

The LGMA said that local authorities are witnessing a "marked decline" in the number of tenders being received for house construction projects.

It believes that this is due to uncertainty over material costs among builders but also due to anticipated changes to the fixed price tendering system to take account of inflation.

The LGMA told committee members that these factors have the potential to reduce housing delivery in 2023 and 2024.

However, it welcomed a recent announcement from Minister for Public Expenditure and Reform Michael McGrath, which will allow contractors to recover up to 70% of their material cost increases on contracts dated prior to 7 January, adding that it will bring "a greater level of certainty to both contracting authorities and contractors operating public work contracts".

TDs and Senators also heard from the CIF; it said that rising costs are impacting on the ability of contractors to acquire financing needed to embark on projects, but also warned that if such costs were added to the purchase price of a home it would push them further beyond the reach of buyers already "locked out" of the market.

Both the CIF and the Society of Chartered Surveyors are calling for Government action across a range of areas including planning, levies and site enabling works to reduce costs.

James Benson, Director of Housing, Planning and Development Services with the CIF, told members that while the organisation welcomes improvements in building standards, this has also led to an increase in construction costs.

Separately, the Oireachtas committee published a report today on urban regeneration.

Among its recommendations is the introduction of a vacant homes tax, an increase in the Residential Zoned Land Tax and a rise in the loan available under the Repair and Lease scheme, currently capped at €60,000, in light of inflationary pressures.