House prices in Ireland grew at an average annual rate of 7.5 per cent in April, amid ongoing supply shortages and surging demand fuelled by Government incentives and expectations of further interest rate cuts.
The headline rate of house price inflation was essentially unchanged from March’s 7.6 per cent and down from 8 per cent in February, the Central Statistics Office (CSO) said on Thursday.
The annual rate of price growth in Dublin, where supply shortages are most acute, accelerated slightly from 6 per cent in March to 6.2 per cent in April.
Outside Dublin, house prices were up 8.6 per cent in the 12 months to the end of April, the CSO said, essentially unchanged from March.
The median or midpoint price of a home purchased over the period was €365,000, down slightly from €362,500 in the 12 months to March.
Dún Laoghaire-Rathdown remained the most expensive local authority area in the Republic, with the median price of a home sold standing at €670,000, while the A94 Eircode in Blackrock in South Dublin was the most expensive postcode with a median price of €750,000.
[ One in five Irish consumers seeking a house to rent or buyOpens in new window ]
Government housing targets continue to be dogged by low levels of supply and the Economic and Social Research Institute (ESRI) last month warned the Coalition not to expect a significant uptick in housing deliveries this year.
The latest housing targets set by the Government aim for a total of 303,000 new homes to be built by 2030, starting with 41,000 homes this year and rising incrementally to 60,000 homes a year by 2030.
Bobby Healy on why Manna drone delivery could be the ‘biggest technology company in the world for its space’
A total of 30,330 homes were built in 2024, a decrease from 33,000 in 2023, which the ESRI said was a “notable weakness”.
Deloitte said on Thursday that a total investment of €122 billion is needed for the Coalition to achieve its housing targets of 60,000 homes annually.
In its latest Crane Survey report, the accountancy firm said just 32,400 homes were granted planning permission in 2024, down 3 per cent on 2023.
This figure is “particularly stark”, Deloitte said, as it represents just two-thirds of what is needed each year to reach the Government’s targets.
Commenting on Thursday’s property price index, Pat Davitt, chief executive of the Institute of Professional Auctioneers & Valuers (Ipav), said: “It is now widely accepted that it will be next year at the earliest before any real impact can be made to advance supply, at any meaningful level.”
Ipav said the Coalition’s new housing plan, which is due next month, must deliver increased supply in a way that no other measure has done over the last decade.
While supply remains weak, demand is also being frustrated by avoidable hurdles and delays with the sales process, according to Mike Stack, a solicitor with Orbitus Law’s digital conveyancing platform Beam.
“Prices may be rising, but the figures alone mask a deeper issue, which is that too many transactions are collapsing or dragging on for months, which is eroding buyer confidence and placing vendors at risk of price renegotiations or even lost sales,” Mr Stack said.
[ Why is the housing crisis Ireland’s most enduring failure?Opens in new window ]
“We’ve found that currently, somewhere around 15 per cent of transactions fall through, and 30 per cent of those are due to last-minute issues uncovered by engineer reports related to planning, compliance, or safety. These surprises almost always hit just before the sale, often after months of negotiation.”
Meanwhile, the CSO said the volume of housing transactions ticked up 4.9 per cent in the month of April to 3,748, evidence of the strength of demand within the market despite affordability challenges.
