Ireland’s Property Prices: 2023 Performance & Expectations for 2024

Recent data from the Central Statistics Office (CSO) offers a mixed picture of the Irish property market as we approach 2024. The most striking trend in the current market is the regional variation in house prices. Counties Clare, Limerick, and Tipperary have experienced the highest annual increases at 6.2 percent, signaling a robust demand in these areas. Although it must of course be noted that these counties are growing from a relatively low base. Conversely, Dublin’s residential property prices have taken a surprising turn with a 0.6 percent decrease. This urban/rural divide highlights a shift in buyer preferences, possibly due to affordability issues and the impact of higher interest rates in urban areas like Dublin. The thinking within Lotus HQ is that supply to the market is playing a bigger role here than suggested by the CSO commentary. 

Despite the dip in Dublin, the overall residential property prices in Ireland have risen by 2.3 percent in the 12 months leading to October 2023. This increase, up from 1.4 percent in the previous year, indicates a sustained demand for housing nationwide. Apartment prices, in particular, have seen a significant increase of 5 percent during the same period. It is unclear as yet whether this can be attributed to buyer preference or buyer desperation, given the lack of housing stock, which we know anecdotally is preferred by most buyers. These figures are crucial for our lending strategies, especially in evaluating funding applications for new construction and residential developments.

The Impact of Rising Building Costs
The cost of new builds has escalated significantly, showing a 10.4 percent increase compared to 2022. This rise in construction costs, coupled with the 113.4 percent increase in new dwelling prices since 2013, really highlights the challenges facing the sector. Project viability is now the dominant conversation. 

First-time buyers, a key segment of the housing market, have increased by 2.8 percent compared to last year. The demand from these buyers is one of the factors keeping the property prices buoyant across the country. However, the increasing interest rates pose a challenge, especially in more expensive markets like Dublin. Mover-purchasers are also returning to the market, possibly anticipating a peak in interest rates and a more stable environment in 2024, according to recent commentary in The Irish Times and the Irish Independent. 

Expectations for 2024
Market commentators and industry experts anticipate that property prices in most regions will continue to rise in the new year. With supply shortages still a significant issue and more movers becoming active, the market dynamics are expected to remain robust. This presents both opportunities and risks for home builders, requiring a nuanced understanding of regional market trends. 
If you are considering a project in 2024, talk to us for a breakdown of local demand by type and tenure. 

Ian Lawlor
086 3625482

Managing Director 
Lotus Investment Group