‘Ireland doesn’t just need more houses, it needs a housing market that is fair’
- Sarah Jane Kearney, director of new homes at DNG
Ireland’s housing market remains under intense pressure in 2025. Demand continues to outpace supply, leaving buyers in a fiercely competitive environment. June’s ECB rate cut gave buyers a lift, but it has only intensified competition in an already overheated market. The figures are stark.
Between January and July, just 7,384 commencements were recorded – down 80 per cent on the same period last year, when levy waivers temporarily boosted activity. With completions expected at around 32,000 new homes this year, output remains far short of national targets and well below demand – estimated to be in the order of 50,000 new units annually according to the Central Bank and ESRI. Reinstating levy waivers would certainly help kick-start commencements and accelerate delivery.
Government support schemes remain central to market activity. The First Home Scheme and Help to Buy initiatives continue to underpin demand in the new homes sector by bridging the affordability gap for first-time buyers, although regional price caps must be reviewed to reflect current price levels in the market.
DNG’s Budget 2026 submission has called again for raising the Help to Buy ceiling from €500,000 to €600,000 – a long overdue adjustment to keep pace with the market. In addition, Affordable Purchase releases through local authorities remain heavily oversubscribed, highlighting the urgent need for additional supply.
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Looking ahead, apartment construction could be the real turning point. Revised planning standards are expected to incentivise new schemes, while the Croí Cónaithe (Cities) Scheme may help unlock stalled urban projects. The fourth call for developers has just closed and there is hope that more schemes will come forward.
Crucially, these homes are designed for owner-occupiers and qualify under both Help to Buy and the First Home scheme. The message is clear: accelerate planning reform, invest in infrastructure, expand cost rental and affordable purchase delivery and unlock land. Ireland doesn’t just need more houses, it needs a housing market that is fair, sustainable and within reach for all.
‘The outlook for the next couple of years is going to be challenging’
- Ivan Gaine, director of commercial and new homes at Sherry FitzGerald and chairperson of Property Industry Ireland
Ireland’s housing system faces significant challenges but shows potential for recovery with co-ordinated efforts by all stakeholders. Addressing infrastructure, planning, land supply, and investment alignment is critical to overcoming the crisis.
Anticipated announcements in Housing for All 2.0 post-Budget in October should bring certainty on policy and allow stakeholders plan for delivery across all tenures be that private, social, cost rental, rental etc. The Government has done a huge amount in tackling rent pressure zones; extending and allowing some variation to planning permissions and rolling out new housing targets to local authorities, which should result in more zoned land and critically infrastructure in the form of utilities and social amenities. It is, however, worrying to see a judicial review of the greater Dublin drainage scheme in recent days which could further delay this critical piece of infrastructure after seven years in the planning system.
Viability remains a key constraint, particularly for apartments. We have seen proof of concept, with strong sales volumes of apartments supported by the government’s Croí Cónaithe scheme, which aims to bridge the gap between the cost of delivery, viability and affordability.
We are moving towards new house typographies now permissible under the planning and design compact settlement guidelines and new tenures from local authority equity loans; first home shared equity and other demand supports such as Help to Buy.
We have close to 50 new-home developments active across the Greater Dublin Area; Cork and Galway and are seeing a pickup in a longer-term pipeline but the outlook for the next couple of years is going to be challenging.
Our new homes sales velocities are in line with last year with a different mix of apartment and duplexes forming a higher percentage of the mix. In 2024 we saw a significant increase on prior year but that increase in momentum has slowed materially.
There are levers the Government can pull such as VAT on apartments, and we are hopeful that there is the fiscal space to reduce costs and aid viability and affordability – there needs to be greater alignment of ambition and co-ordination of delivery across government departments and particularly as it relates to critical infrastructure delivery.
‘Visionary policies are urgently needed’
- Des Donnelly, new homes director at Hooke & MacDonald
The outlook for the new homes market contains numerous positives and opportunities. Most importantly we have a highly efficient and dedicated building industry that is ready, willing and able to produce significantly higher volumes of new homes. However, it is dependent on policymakers to produce and implement with more urgency the measures needed to fix the flawed planning system, to fast-track investment in infrastructure, to zone many thousands of more acres for housing and to introduce incentives to attract back Irish and international pension and other institutional funds into housing delivery, especially the apartment sector in urban locations for both owner-occupiers and tenants.
The lack of viability for apartment construction has been acknowledged by the Government with the introduction of the Croí Cónaithe (Cities) Scheme, which facilitates apartment purchases by owner-occupiers by bridging the gap between construction costs and sale prices. Further measures such as section 23-type tax incentives for purchasers could considerably ramp up apartment supply in urban locations, as it did in the past, successfully increasing the stock of rental accommodation over a short period. It proved to be a sound concept until politicians applied it in non-urban locations.
A number of government schemes are greatly helping aspiring homeowners to achieve their goals, especially the Help to Buy scheme, the First Home scheme and the Affordable Purchase scheme.
The strong Irish economy and our stable political system should support the expansion of our new homes supply to help meet demographic requirements in 2026 and beyond. However, visionary policies are urgently needed to provide the volume and variety of typologies that are required to house all sections of the Irish population.
‘The new homes market remained particularly busy’
- Ray Palmer-Smith, director of new homes at Knight Frank
A robust economy, favourable demographics, including continued strong net migration (with significant numbers from the United States), affordability supports and recent interest rate cuts has meant that the new homes market remained particularly busy in the first half of the year. Data from the CSO shows that sales were up by 22 per cent compared with 2024 and, despite an early summer slowdown, Knight Frank saw a record number of new homes reservations in August.
The lack of housing supply remains a concern. While completions increased by 20 per cent in the first half of the year compared with 2024, the out-turn for the whole year is projected to show a modest uplift in relation to 2024, with most forecasters projecting in the region of 33,000-34,000 units, well below the government’s targets. According to the CSO, new homes prices increased by 4.2 per cent year on year in June with the continued shortfall in supply expected to drive further price growth.
Measures have recently been introduced to remove some of the obstacles to increased delivery. The publication of the National Planning Framework Guidelines on Housing Growth and Zoning Requirements, as well as infrastructural commitments in the National Development Plan, have provided optimism that much-needed zoned and serviced land will begin to be freed up. Developers have also welcomed the revised standards for apartment development, which should increase apartment construction. It is recognised that Ireland needs to build at least three times the number of apartments that were constructed in 2024 if it is to hit housing targets.
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Despite these measures, several continuing challenges must also be navigated. Notwithstanding current efforts to streamline the planning process, the rising number of judicial reviews increased risk aversion at all stages of the infrastructure development cycle. Additionally, the capacity of the construction sector remains below the pre-crisis peak despite a much larger economy and population and is another big challenge to scaling up housing delivery.
‘Apartment construction is a huge priority’
- Frank McSharry, director of new homes at Lisney Sotheby’s International Realty
Demand for residential property in Ireland remains extremely strong across all segments of the market, with new homes particularly in demand due to their build quality and energy efficiency. First-time buyers remain active but rely heavily on the Help to Buy scheme, which has not kept pace with rising property prices. We recommend a review of the price threshold to ensure this scheme can continue to assist young families.
Despite a broad consensus that at least 50,000 new homes are required annually, delivery numbers for 2025 will be well below this level. A lack of zoned land, serious viability issues (particularly with apartments), infrastructural deficits (electricity, water, and wastewater), and planning delays have affected commencement numbers.
Apartment construction is a huge priority. High-density apartment schemes are crucial to drive-up housing delivery numbers. Despite strong demand, it is not currently viable to build new apartments, with an approximate €100,000 gap between the construction cost of an individual unit and the achievable sales price in most parts of the country. Recent adjustments to apartment design standards will allow for cost efficiencies that will partially bridge the viability gap.
Taxes make up a significant portion of the cost of apartment delivery. Reducing the VAT on new apartments to zero per cent for a number of years is necessary to truly improve viability, unlock many stalled apartment developments and make a material improvement to delivery numbers. This should be prioritised in the upcoming Budget 2026.
The recently revised National Development Plan sets out ambitious targets to substantially increase the supply of zoned land within all local authorities (providing capacity for up to 83,000 housing units annually) and has allocated significant funding towards badly needed infrastructural improvements. Both measures are of crucial importance to driving housing delivery and need to be successfully implemented.
‘Initiatives are helping a diverse range of purchasers’
- Sarah Murray, director of new homes at Savills
As housing supply gradually expands, buyer demand is rising at a stronger pace, creating a competitive environment across the market. This has prompted prospective purchasers to widen their search beyond core urban areas. Increasingly, well-connected suburbs and regional towns are being considered by buyers who value accessibility alongside quality and affordability.
A notable trend is the growing interest in new build apartments and duplexes. These properties are becoming central to buyer choice as more developments deliver well-designed homes with a range of layouts and price points. This mix of housing is essential, broadening the market’s appeal and enabling more people to secure suitable homes.
Earlier this year we anticipated that the Croí Cónaithe (Cities) Scheme would begin to deliver homes in Dublin and Cork. That expectation is now being realised, with the first 150 homeowners due to move in before Christmas. Their arrival marks an important milestone, proving that the scheme can successfully unlock high-quality apartments for the private market. The momentum is building: according to recent reporting, developers have applied for subsidies to build almost 6,000 apartments nationwide under the scheme this year. This pipeline underlines the scheme’s role in bridging viability gaps and supporting new supply where it is needed most. As the autumn selling season unfolds, a new wave of apartments will be launched, and based on strong summer activity, demand is expected to be robust.
Equally important is the breadth of government incentives now available. From supports for first-time buyers to measures assisting those trading up or down, these initiatives are helping a diverse range of purchasers to access the market. Incentivised schemes, combined with a wider mix of housing product, fosters greater participation and confidence – both vital for a balanced and functioning property market.
‘The next 12-18 months will be defined by confidence, resilience and steady progress’
- Will Coonan, director of Coonan Property
The Greater Dublin Area’s new-homes market is entering the final months of 2025 with strength and a confident outlook. Demand remains robust, supported by a younger demographic keen to transition from rental into ownership, and bolstered by continuing government initiatives that are assisting first-time buyers close the gap on deposits and income thresholds.
The Help to Buy and First Home schemes remain central to this momentum. Both are playing a critical role in making new housing attainable, especially in suburban communities where family homes are most in demand. Coupled with a more stable interest-rate environment, buyers are approaching the market with a sense of clarity and certainty.
For developers, strong sales rates across well-located schemes are providing reassurance to bring forward new phases. While construction costs remain elevated, demand fundamentals have proven resilient, giving confidence that newly launched projects can achieve their targets. This is particularly true in commuter belt counties such as Meath, Kildare and Wicklow, where demand for spacious homes with good transport connectivity is driving sustained growth.
Looking ahead to 2026, it would appear there will be limited supply in prime locations, combined with consistent demand, which will underpin single-digit growth across much of the Greater Dublin Area. Rather than deterring buyers, this has reinforced urgency, with many households eager to secure a new home when availability allows.
Overall the next 12-18 months are set to be defined by confidence, resilience and steady progress. With strong buyer appetite, supportive policy measures and solid delivery in key growth corridors, the Greater Dublin Area’s new homes market appears well positioned for a period of sustained expansion.
