As we progress through 2025, the Irish residential property market continues to show resilience — though buyers, sellers, and investors alike are navigating a complex landscape. Prices remain buoyant, mortgage conditions have eased slightly, and supply-side constraints continue to dominate the narrative.
What’s Happening With Prices?
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According to the latest data from the Central Statistics Office (CSO), the national Residential Property Price Index (RPPI) rose by 7.4% in the 12 months to August 2025 — the same annual rate as for the previous year.
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Regionally this growth is uneven. While property prices in Dublin increased by about 5.3%, areas outside Dublin saw a sharper rise of 9.2%.
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Median sale prices across Ireland now stand at around €375,000 for a dwelling.
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That said, many in the industry expected as much as 8–9% growth in 2025 in scenarios where supply bottlenecks persist.
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Together, this suggests that while growth may have moderated slightly, price pressure remains firmly in place — especially outside the major urban centres where demand continues strong.
Mortgage Rates & Financing: A Slight Breather..
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Mortgage interest rates have softened compared with their peak levels. According to the Central Bank of Ireland (CBI), as of June 2025 the median rate on Principal Dwelling Home (PDH) mortgages sits around ~3.45%, with many loans still well below 4%.
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Part of this easing reflects broader shifts in monetary conditions, with interest rate cuts during 2025 — a trend noted in outlooks from property-market analysts.
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However, even with this relative relief, many prospective buyers continue to find that elevated home-prices and affordability issues remain a significant challenge — meaning lower rates only go so far to ease the pinch.
Supply & Demand: A Market Still Starved for Homes
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The dominant theme across the country remains a persistent mismatch between high demand and limited supply. According to the Society of Chartered Surveyors Ireland (SCSI), as of mid-2025 around 70% of member agents report “low stock levels” — both in terms of new and second-hand properties.
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More than half (51%) cite limited supply as the main driver of ongoing price inflation.
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Meanwhile, despite efforts and some increase in completions, supply is not catching up fast enough. The backlog of unmet demand — often described as “pent-up demand” — is likely to last well beyond 2025.
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This imbalance means many buyers face fierce competition, forced to pay over asking price; according to a recent industry report the “average residential property sold in 2025” fetched around €426,000, a level described as some of the least affordable since the mid-2000s.
What It All Means — For Buyers, Sellers & Investors
For Buyers (First-time or Otherwise)
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The lower mortgage rates offer some relief — but price levels remain high and affordability stretched, especially in popular commuter zones or cities.
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Competition is intense, and in many cases you may be bidding against other buyers keen to get ahead before prices climb further.
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For those flexible enough to look outside major urban areas — whether in smaller towns or rural counties — there may still be relative value.
For Sellers & Investors
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It remains a strong seller’s market in many parts of Ireland. With demand outpacing supply, properties (particularly well-located or well-presented ones) continue to sell briskly.
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Investors may still find opportunities, especially where rental demand is high — though the shortage of available stock means pricing pressure could stay elevated.
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That said, long-term investors should consider the risk that supply eventually catches up, or that affordability constraints weigh on demand.
For the Market Overall
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The gap between demand and supply remains the defining issue — and it’s unlikely to close anytime soon. Some commentators expect “pent-up demand” conditions to persist well into the 2030s.
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As long as supply constraints remain, upward pressure on prices — especially in desirable areas — is likely to persist.
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But there are signs of moderation: with mortgage rates lower and some increase in completions, the market may move toward a slow-growth, more stable trajectory rather than the rapid price surges of recent years.
Looking Ahead: What to Watch in 2026
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Ongoing interest rate policy: If borrowing costs remain reasonable (or fall further), that could support continued demand.
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Housing supply: New-build completions, planning approvals, and renovation/activity in the second-hand market will be critical.
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Affordability pressure: If prices or interest rates rise again, or wage growth fails to keep pace, demand (especially among first-time buyers) could soften.
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Rental market conditions: With limited supply for purchase, rental demand — and rent levels — may remain elevated, which could influence investor interest.
