The latest residential property price index from the Central Statistics Office (CSO) revealed that house prices in Ireland increased by an average of 7.5% annually in April. This growth is attributed to ongoing supply shortages and high demand driven by Government incentives and expectations of further interest rate cuts.

The headline rate of house price inflation remained relatively stable at 7.5% in April, compared to 7.6% in March and 8% in February, according to the CSO. In Dublin, where supply shortages are most severe, the annual price growth rate slightly accelerated from 6% in March to 6.2% in April. Outside of Dublin, house prices rose by 8.6% in the 12 months leading up to April, similar to the growth rate in March.

The median price for a home purchased during this period was €365,000, a slight decrease from €362,500 in the previous 12 months. Dún Laoghaire-Rathdown remained the most expensive local authority area in Ireland, with a median home price of €670,000. The A94 Eircode in Blackrock, South Dublin, was the priciest postcode with a median price of €750,000.

Despite Government housing targets aiming for 303,000 new homes by 2030, with 41,000 homes planned for this year, the Economic and Social Research Institute (ESRI) cautioned against expecting a significant increase in housing deliveries in 2025. Only 30,330 homes were constructed in 2024, down from 33,000 in 2023, which the ESRI described as a notable weakness.

Deloitte estimates that an investment of €122 billion is required for the Government to achieve its goal of 60,000 new homes annually. However, only 32,400 homes received planning permission in 2024, representing two-thirds of the required number to meet the targets.

Commenting on the property price index, Pat Davitt, CEO of the Institute of Professional Auctioneers & Valuers (Ipav), stated that significant progress in advancing supply is not expected until at least next year. He emphasized the need for the upcoming housing plan to boost supply in a way that previous measures have not achieved over the past decade.

While supply shortages persist, delays and obstacles in the sales process are also hindering demand, according to Mike Stack from Orbitus Law's digital conveyancing platform Beam. Stack highlighted that around 15% of transactions fall through, with 30% of these failures attributed to last-minute issues uncovered by engineer reports related to planning, compliance, or safety.

Despite affordability challenges, the volume of housing transactions increased by 4.9% in April to 3,748, indicating strong demand in the market.