Demand for new homes more than doubles in just one year

The growth in the numbers wanting a new property was up 117% in May 2023 compared to the same month last year, according to the report. File Picture.

Demand for new homes has more than doubled in the last year, reinforcing the “desperate need” for increased supply.

Analysis carried out by Daft.ie notes a surge in enquiries sent to property listings in most parts of the country last year, with the nationwide demand for homes up by 17%.

The growth in the numbers wanting a new property is particularly strong, up 117% in May 2023 compared to the same month last year.

The Daft.ie research found that homes with a listed price of between €400,000-€600,000 have seen the biggest rise in demand, climbing by 38%.

“New homes within the price bracket of €400,000-€500,000 saw a staggering surge in demand of 1,783% (a 17-fold increase)," the report stated.

It can be assumed this price point has seen the largest increase due to the help-to-buy scheme qualifying criteria whereby the purchase value of the property must be €500,000 or less.”

The figures also show:

• There has been a surge in enquiries for properties in larger cities, up 34% in Dublin, 26% in Limerick, 13% in Cork and 9% in Galway;
• This rise was more significant for new homes, up 99% in Dublin, 160% in Galway, 88% in Cork, and 84% in Limerick;
• 18 of 26 counties recorded an increase in demand compared to the same period in 2022;
• Interest in homes listed between €200,000 and €400,000 increased by 24%, while there was a 20% rise in interest for homes listed between €600,000 and €800,000.

Daft.ie said its figures show demand for homes nationwide has strengthened year-on-year.

However, it said its survey does not cover supply.

“The supply in the sales market in Ireland over the course of the last 12 months was not one where supply was adequate to meet demand," the report stated.

The Irish housing market is in desperate need of increased supply over the years, and indeed decades to come.”

The latest figures from the Central Statistics Office show that construction activity rose in the first three months of 2023 in both volume and value terms.

However, recent analysis published by Goodbody found that the number of new homes that have seen construction commence has been “flatlining” in recent months, with forecasts that 27,000 homes will be completed this year “substantially below” the country’s estimated housing need.

The level of demand is also evidenced by the most recent figures from the Banking & Payments Federation Ireland (BPFI) which show applications for new mortgages remains strong despite a series of interest-rate hikes by the European Central Bank (ECB). 

The Daft.ie figures also come in a week that has already highlighted the acute crisis in housing.

Last Friday, the Department of Housing published its latest homeless figures which saw the numbers of adults and children without a home reach a grim new peak last month, with more than 12,000 people in emergency accommodation for the first time.

Figures released by the Residential Tenancies Board on Tuesday showed that a further 4,753 notices to quit were issued to tenants in the first three months of 2022. 

In just under a year, 13,800 households have been given notices to quit.