Owning a home to remain a 'pipe dream' for first-time buyers as house prices continue to surge

Irish Examiner

a day ago

Property price inflation is holding steady in Ireland, as the cost of buying a home continues to surge, with first-time buyers warned house prices would continue to be a 'pipe dream' for the foreseeable future.
For the second month in a row, the Central Statistics Office (CSO) said the 12 months to June saw its Residential Property Price Index rise by 7.8%.
Inflation outside of Dublin continues to outstrip that of the capital, with prices there rising by 6.6% compared to the 8.8% rise in the rest of the country.
The median price of a home in Ireland now stands at €370,000. The highest median price paid for a dwelling was €675,000 in Dún Laoghaire-Rathdown, while the lowest was €190,000 in Leitrim.
While property price inflation peaked at over 10% last summer, this has only moderated slightly since then and has not gone below 7%. Prices have now been consistently rising for almost two years, according to the CSO.
House prices in Ireland are now almost 20% higher than the peak of the Celtic Tiger boom in April 2007. And, from their trough in May 2013, property prices outside of Dublin are almost three times higher now (180.2%).
When it comes to the difference between new and second-hand properties, the lack of adequate supply to meet demand means the cost of second-hand homes continues to rise at a higher rate, with inflation of 8.8%.
In June, 4,029 home purchases at market prices were filed with Revenue, which was a 13.1% increase on June 2024. Of these, 1,531 were first-time buyers, which was also an increase of 21.5% on the same time last year.
However, with no end in sight to high property inflation, Irish Mortgage Advisors chair Trevor Grant said it meant homes were becoming increasingly out of reach for many first-time buyers, 'turning their hopes of home ownership into a pipe dream'.
He also said all eyes would now be on the Government's revised housing plan this autumn in the hope it can address the root causes of the crisis.
'This new plan is expected to include reforms which will speed up the delivery of housing and see more affordable housing rolled out,' Mr Grant said. 'If the country is ever to emerge from the housing crisis, it's important that the Government get this plan right.
'The lack of labour to build houses is also an issue — skill shortages and access to labour are critical challenges for the building industry, which unfortunately also drive up house building costs and in turn house prices.
'Regardless of any Government reforms or initiatives announced this autumn, Irish house prices are likely to continue to be high for the foreseeable future.'
Rachel McGovern, deputy chief executive at Brokers Ireland, said the latest figures pointed to the major task at hand for the Government as it prepares to unveil its new housing plan.
'It will take comprehensive and very unprecedented measures to unlock the impediments, particularly in zoning, planning and infrastructure,' she said.
'Even with unprecedented measures, it is likely to be a couple of years before we would see major change. But it must start.'