The demand for up to 100,000 additional housing units is not included in the official figures from the council

It said the guidelines issued to councils so they can estimate local housing needs dramatically underestimate the magnitude of the pent-up demand for people living with parents, living in overcrowded households or who are homeless.

The analysis was carried out for the Construction Industry Association last July and sent to the Housing Authority. It was obtained from the Sunday independent under freedom of information. Methods were examined to help local authorities use population projections in the planning process to estimate housing needs.

The report blamed a lack of proper guidance for local authorities, which is likely to limit housing supply in the short term.

An analysis by the Housing Department estimates the potential number of households living in overcrowded conditions could be as little as 5,131. However, according to KPMG, this number does not take into account the thousands of additional housing units that will be needed.

While the Housing Department said it disagreed with future housing needs being constrained by methods used to calculate housing supply targets for urban development plans, government officials have been warned that some of the data used is out of date, leading to inaccurate calculations.

Looking at data on the number of adults who work but live with their parents, the report finds that 112,641 households have the potential to be considered overcrowded.

“Housing Department analysis estimates that this is just 5,131 households. The reality is probably somewhere in between, but certainly not as low as the estimate used by the ministry,” the report added.

This discrepancy is partly because the official method for calculating housing demand assumes that overcrowding is based on the number of people living in a house versus the number of rooms. KPMG’s report suggests using other definitions, including examining average household size and the age of residents.

“The use of such an underresearched estimate is worrying and jeopardizes the reliability of housing supply estimates,” it said.

A Housing Department spokesman said it was important to note that many students live at home and should not be viewed as potential home buyers or renters. He cites CSO data showing that the high number of people living with parents decreases dramatically with age.

Developers have complained that councils are too conservative when making housing needs assessments. In February, Bartra Capital wrote to Dublin City Council complaining of an assessment that a need for 6,690 housing units per year was “a gross underestimate” and did not take into account unmet demand or adult children living with parents.

The report also makes a number of recommendations, including providing local authorities with further guidance and training on how to use housing supply targets and making better use of land use in areas of high housing demand.

“Many local authorities also have to lead large adjustments to zoned housing areas” because their demand numbers are based on “outdated” and “conservative” estimates, the report said. She cites Meath as an example of an area where these numbers could have an impact, “essentially jeopardizing supply where it’s needed most.”

“Land dezoning has put the county out of step with its growing population” and the number of people expected to leave Dublin in the coming years, the report added.

The housing ministry said there was no shortage of zoned land and less than 15 percent of the zoned lands six years ago had been the subject of development. A spokesman said the method of making housing demand forecasts will evolve to ensure the planning system is robust and training has been carried out since the report was finalized to ensure councils understand how to make forecasts.