House prices to keep rising until late 2026, says Martin
Under the newly agreed government targets on housing, 43,000 homes will be built in 2026, with 48,000 in 2027
Prospective homeowners face another three to four years of spiralling house prices, just as the cost of renting a home in cities is soaring to record levels.
Fianna Fáil leader Micheál Martin said on Tuesday that house prices will not "moderate" until late 2026 at the earliest, and that he does not expect to see house prices coming down until Ireland is seeing 45,000 homes a year completed.
Under the newly agreed government targets on housing, 43,000 homes will be built in 2026, with 48,000 in 2027.
It comes as the latest rental report from Daft.ie shows rents in excess of €2,000 a month in Cork, Dublin, Galway, and Limerick cities, with markets rents rising almost 20% in Limerick in the last year.
On the campaign trail in Dublin on Tuesday it was put to Mr Martin that the Government has said housing supply has increased over its lifetime yet prices have not come down. However, Mr Martin said supply "has not gone up enough".
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He said the government needs to be more successful in "brownfield sites and modern methods of construction".
Pressed on what number of homes would be required to bring down prices, the Tánaiste said:
Asked if this meant prices should come down by 2027 or 2028, he said he would "like to see prices moderating, at least (by then)".
Mr Martin's comments came as Sinn Féin said that a key plank of its housing proposal — that affordable purchase homes would be built on State land but that the land under the home would not be owned by the homeowner — is viable.
Housing spokesperson Eoin Ó Broin said banks have indicated that they will lend into his affordable purchase scheme if they receive a charge on the land.
"I've said time and again that they would get that charge," Mr Ó Broin said, adding this would make it possible to sell homes from €250,000 upwards.
Meanwhile, the latest Daft.ie quarterly rental report has shown that average market rents in Limerick city have risen a staggering 19.2% in the last year to €2,221 a month, while they have risen 10.4% to €2,077 in Cork city.
Dublin has the highest average market rent in the country at €2,476 a month, up 5.2% while rents in Waterford city have risen 5.8% to €1,639. Nationally, open-market rents are up 7.2% in the last year to an average of €1,955 a month.
At the beginning of November, there were just over 2,400 homes available to rent across the country. This was a reduction of 14% on November 1, 2023, and well below the 2015-2019 average of almost 4,400.
The rise in Dublin comes after a period of low inflation in the capital with Daft.ie report author and Trinity College Dublin economist Ronan Lyons warning that we are likely to see a larger rise in rents in Dublin in future due to reduced supply.
He said the number of apartments completed in the capital in the first nine months of this year is down a quarter on the same period in 2023. Last year, much of the delivery of new apartments in Dublin went directly to the private rental market, as well as towards social housing.
As that pipeline dries up, conditions in Dublin are likely to be similar to other parts of the country as a re-emergence of very weak supply faces up to strong demand.
“The target for the new government has to be giving the same priority to the rental sector that has been given to owner-occupiers and to social housing over the last few years,” Dr Lyons added.
“Otherwise, it’s hard to see when conditions will change.”
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