BY JOHN ELLIS, FINANCIAL ADVISOR
Ireland’s housing market is under strain with property prices rising 7% in the three months to June 2025 driven by a continual shortage of homes. According to MyHome.ie the average asking price reached €395,000 nationally with Dublin sellers seeking €495,000 and regional prices hitting €340,000. The report, authored by Bank of Ireland chief economist Conall Mac Coille, describes a “very tight” market where demand far outstrips supply pushing buyers to pay 7.5% above asking prices on average.
The supply crisis is bleak. MyHome.ie reported just 12,563 properties listed for sale at the end of June, a marginal 1% increase from 2024.
Mac Coille estimates that Ireland needs 50,000 to 60,000 new homes annually to address the shortage, but current construction falls short of this mark. Declining private investment particularly in Dublin’s apartment sector worsens the issue. High building costs and stringent design standards make apartment development less workable with developers citing Europe’s highest construction costs as a barrier.
Despite the supply crisis sales are rising. The Property Price Register shows 22,000 homes sold this year, up 2%, at an average price of €445,000. However, this demand fuels competition and with recent easing of bank lending rules has added €15,000 to €20,000 to prices further pricing out first-time buyers. Rents averaging €1,670 monthly rose 5.2% in the year to May compounding affordability woes. Meanwhile Daft.ie reported a 12.3% price hike and Sherry FitzGerald noted a 43,000-home drop in rental stock over five years, underscoring the crisis’s depth.
Public frustration is mounting. Last week the Community Action Tenants’ Union led a large protest in Dublin, “decrying homeownership as completely inaccessible.” Demonstrators backed by over 80 organisations urged Government action.
The Government is responding with new measures. Minister for Housing James Browne plans to relax apartment design standards reducing minimum floor areas and easing requirements for features like balconies. These changes, expected to be approved this week aim to cut construction costs by €50,000 to €100,000 per unit making apartments more affordable.
Browne, emphasising private sector involvement, told RTÉ recently that Ireland has been “way too cautious” about attracting investment. A new housing plan replacing the earlier Housing for All strategy is scheduled for the autumn, delayed by the need to align with the National Development Plan’s funding review.
However, opposition voices like Sinn Féin’s Eoin Ó Broin criticize the apartment rule changes as “utter madness,” arguing they will inflate land values without addressing viability. The delay in the housing plan’s release, potentially until September, has also drawn concern echoing past government delays criticised by the opposition.
Ireland’s housing crisis demands urgent action. While new policies aim to boost supply, balancing affordability, construction costs and private investment is still a challenge. Without swift effective measures the dream of homeownership will slip further from the reach of many.
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