Irish second-hand home prices are on track to soar by as much as 10 per cent next year, accelerating for the third year in a row, amid an ongoing supply shortage, according to Sherry FitzGerald, the State’s largest estate agent.
The company said the average value of second-hand homes rose by 7.2 per cent in 2024, up from 3.8 per cent in 2023.
In Dublin, values grew by 7.1 per cent annually, with a 1.1 per cent increase in the final quarter alone – more than double the growth recorded in the previous year. Outside Dublin, price inflation reached 7.3 per cent for the year.
“These figures highlight significant growth across urban and rural areas, driven by persistent supply-side challenges. We anticipate further price inflation of 8-10 per cent in 2025 unless these issues are addressed,” said Marian Finnegan, managing director of Sherry FitzGerald.
The national residential property price index, which includes both new and second-hand home sales, was up 9.7 per cent on the year as of the end of October, according to the most recent data from the Central Statistics Office. The average price of a home in Dublin is now more than €600,000.
The Economic and Social Research Institute (ESRI) warned earlier this month that Irish house prices were overvalued by up to 10 per cent and that an increasing number of households were carrying “elevated” levels of mortgage debt.
The first nine months of 2024 saw approximately 33,700 housing transactions by household buyers, a 6 per cent decline compared to the same period in 2023, according to the firm. This decrease was led by an 8 per cent drop in second-hand home sales, partially offset by a 5 per cent rise in new home transactions.
Some 32,000 new homes are expected to have been completed by the end of this year, EY-Euroconstruct, a network of experts that tracks construction trends across 19 European countries, said in a report earlier this month. That is well short of the “almost 40,000″ promised by outgoing Fine Gael Taoiseach Simon Harris in August.
Next year, the industry could build 38,000 homes with the figure rising to 40,000 in 2026, according to EY-Euroconstruct. However, the Central Bank estimates the State needs 52,000 new dwellings a year to get on top of its long-running housing crisis, while Government pledges run to 50,000 annually over five years.
Sherry FitzGerald Research estimates that 62,000 homes are required to meet annual demand in the short term.
Politicians highlighted the Republic’s decade-old housing crisis as a key issue for voters in last month’s general election, while all parties that contested the poll made ambitious pledges for new home building.
Looking ahead, Ms Finnegan noted that Irish housing commencements through to November 2024 totalled 54,575 units, an 84 per cent increase from the prior year. This surge aligns with the expiration of the development levy waiver and water charge rebate, positioning the housing pipeline for stronger delivery in 2025 and 2026.
“The formation of a new government must prioritise housing at the top of its agenda,” Ms Finnegan said. “Extending the Help-to-Buy scheme and attracting private equity to Ireland are essential to tackling the emergency.”
Minister for Finance Jack Chambers decided in October to extend the Help-to-Buy scheme, which provides tax breaks to first-time buyers and has been availed of by approximately 50,000 buyers since being introduced, to the end of 2029.
This story was updated on December 30 to correct an editing error in the subhead on demand continuing to exceed supply
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