Irish consumers are adopting a more cautionary stance towards investing their money as housing and rent costs continue to sap confidence, according to a new Bank of Ireland survey.
The lender’s latest savings and investment index indicates that sentiment among consumers has remained stable in the first three months of the year compared with the final quarter of 2024. A small increase in the number of survey respondents who said they were currently saving was offset by a slight drop in investment sentiment, Bank of Ireland said.
While the volume of consumers who said they are investing their money remained at a record high for a second quarter in a row, there was a noticeable decline in how people expect the stock market to perform over the next six months, the report’s authors said.
Some 44 per cent of respondents said they expect global equities to decline in the next six months compared with 32 per cent in the fourth quarter of last year.
Kevin Quinn, chief investment strategist at Bank of Ireland, said it was not surprising to see consumers still willing to invest their money, given the strong performance of equities over the past couple of years.
“That said, a lot is happening in 2025 to influence how people view the stock market and there is a much more cautious tone as a result,” he said. “In quarter one alone, we have seen the onslaught of change from the new US administration as well as a very changed landscape in Europe.”
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Against this backdrop, it is also not surprising to see investors expressing “a more cautious tone”, Mr Quinn said.
Rising house prices and rents are also continuing to eat into confidence, with 23 per cent citing housing costs as the factor about which they are most concerned.
This sentiment is particularly acute among 16- to 29-year-olds, with 29 per cent in this younger age cohort citing it as their top concern.
The survey also indicates that households in the Republic are continuing to return to pre-pandemic levels of savings. More people think now is a good time to save than in late 2021, Bank of Ireland said, and this was reflected in the volume of survey respondents who said they are saving money returning to the historic highs last seen on the eve of the pandemic in February 2020.
“There’s no doubt people recognise the need to save but when combined with the impact of the cost-of-living crisis of recent years, the savings habit is only returning slowly,” Mr Quinn said. “This is demonstrated through a higher incidence of saving this quarter but [also] the smaller amounts that people can afford to put away.”
