Why First-Time Buyers Are Losing the Housing Race in Ireland

Last updated: July 2026. All figures are sourced from the CSO, ESRI, CCPC, BPFI, RTB, Revenue, and the Central Bank of Ireland, with publication dates noted throughout.

Ireland’s housing crisis is no longer just about rising prices. For many first-time buyers, the challenge has evolved into something deeper: a housing market where affordability, competition, institutional purchasing, and psychological pressure collide at the same time.

The paradox is stark. First-time buyer mortgage approvals reached 32,219 in 2025 — the highest level since the series began in 2011, according to the BPFI Housing Market Monitor Q4 2025. Yet only about one-third of new homes built in Ireland now reach private households on the open market, Sherry FitzGerald research reported by The Irish Times found. More approved buyers are chasing a smaller share of new supply than at almost any point in the past 15 years. [bpfi]

Key Statistics at a Glance

The State Has Become a Major Competitor in the New Homes Market

One of the strongest trends in Ireland’s housing market is the increasing role of state-backed and institutional purchasing.

According to the Central Statistics Office, non-household entities — companies, funds, charities, local authorities, Approved Housing Bodies and State agencies — purchased 12,857 dwellings in 2025, worth €5.1 billion. That is just over 20% of the 63,440 residential properties acquired in the State that year. Crucially, new dwellings accounted for 59.5% of those non-household purchases, meaning institutional and State demand is concentrated precisely where first-time buyers are looking.[cso]

Within that group, the public sector is now the single largest purchaser. Government agencies and other State bodies acquired 6,865 homes in 2025 — 53% of all non-household purchases, valued at €2.6 billion, The Irish Times reported on the CSO data.[irishtimes]

The effect on open-market supply is measurable. Research by Sherry FitzGerald, reported by The Irish Times, found that between 2020 and 2025 an average of just 33% of new homes were bought by private households, compared with 57% in the preceding six-year period. Of the 36,246 new completions in 2025, only 12,135 were sold to households. The open-market share hit a 15-year low of 29% in 2023.

Economist David McWilliams, writing in a 2025 Irish Times opinion column, argued that the State has effectively become “the dominant buyer in the new homes market,” pointing to homebuilder Cairn Homes’ forward sales order book, which he noted rose from €534 million in 2023 to €946 million in 2024. This is a commentary interpretation of company accounts rather than a peer-reviewed finding, and should be read as such — but the underlying CSO transaction data above supports the broad direction of the argument.

Why developers favour this model: forward sales agreements remove sales uncertainty, reduce marketing costs and lower financing risk. For buyers, the consequence is that homes may be built without ever reaching the open market.

Who buys new homes in Ireland

Source: CSO Residential Property Transactions by Non-Households 2025; Sherry FitzGerald research.[cso]

Mortgage Approved — But Still Locked Out

Mortgage approval no longer guarantees access to homeownership, and the data now shows the gap clearly.

BPFI figures show that 32,219 first-time buyer mortgages were approved in 2025, but only 27,652 were drawn down — a gap of roughly 4,500 approved buyers who did not complete a purchase in the same year. Approvals typically remain valid for six months, so a portion of that gap is timing rather than failure — but the direction is consistent: approval volumes have hit records while completions lag.[bpfi]

The competitive picture explains why. First-time buyers now account for 60% of all mortgage drawdowns, up from 18% in 2006, while mover-purchaser activity has fallen for three consecutive years to just 19% of the market, according to the BPFI. Cash buyers account for around one in three household purchases, Bank of Ireland’s Housing Update reported. And the second-hand market — where 76.1% of household purchases now occur — is shrinking, with existing properties sold falling for a third straight year to 38,502 in 2025, the lowest since 2020.

Borrowing capacity is also capped by regulation. Under the Central Bank of Ireland’s mortgage measures, first-time buyers can borrow a maximum of four times gross income with a minimum 10% deposit. Lenders may exceed the limits for up to 15% of first-time buyer lending, but in practice only 5.3% of first-time buyer loans were issued above four times income in 2024, The Irish Times reported using Central Bank data.[centralbank][irishtimes]

In short: affordability is no longer only about borrowing power. It is about inventory access, and about who buyers are competing against.

Overbidding Has Become Normalised

The emotional pressure of the Irish market is now reshaping buyer behaviour itself — and this is one of the few areas where the evidence is experimental rather than anecdotal.

In February 2026, the Economic and Social Research Institute published Buying and Selling Property in Ireland: Behavioural Evidence on Bidding Systems, Stressors and Market Comprehension (ESRI Research Series No. 226), authored by Deirdre Robertson, Adam Joachim Shier, Shane Timmons and Pete Lunn and funded by the Competition and Consumer Protection Commission. The study ran a controlled auction experiment with roughly 800 nationally representative participants, alongside a survey of buyer and seller experiences.

The findings were consistent across every bidding format: participants bid more than they believed a property was worth. But the size of the effect varied sharply by system.

How bidding systems change buyer behaviour

Source: ESRI Research Series No. 226, February 2026, as reported by TheJournal.ie.

The ESRI attributes this to well-documented cognitive biases — the report identifies auction fever, loss aversion, herding, anchoring and ambiguity aversion among them. In an earlier ESRI working paper published in October 2025, the researchers noted that Ireland’s “open offer” system tells bidders when someone else has bid higher, creating a feedback loop that encourages escalation.

Dr Deirdre Robertson, ESRI senior research officer, said the findings show buyers are “navigating a system they may not fully understand and increasingly experiencing stress,” and that “the most commonly used bidding systems encourage people to overbid, inflating prices” (CCPC).

One important caveat for readers and researchers: this was a controlled experiment measuring hypothetical bids, not observed market transactions. It demonstrates a behavioural mechanism, not a measured euro impact on Irish sale prices.

Online Bidding Is Intensifying Competition

Digital property platforms have made bidding more visible, faster, and psychologically more intense—and the ESRI research exposes a genuine contradiction at the centre of this.

Roughly one in two participants favoured a visible online bidding platform, believing it to be fairer, The Irish Times reported. Yet the same study found online platforms inflated bids the most, while sealed bidding — the least popular option — inflated them the least.

Buyers want transparency. But transparency, in this form, fuels competitive escalation.

Trust in the current system is low regardless. Only 16% of buyers believe the housing market is transparent, according to CCPC research cited in the MyHome and Bank of Ireland report Improving Ireland’s Homebuying Process, published in December 2025. That report also found that about one in seven homes sells for at least 20% above the asking price.

The ESRI survey found 14% of the 476 buyers surveyed suspected they had encountered “ghost bidding” — invented bids used to drive up a price — and around one-third of prospective buyers expected to encounter it, as reported in The Irish Times. There is no way to verify whether ghost bidding actually occurred in those cases; the ESRI presents the figure as evidence of a trust deficit rather than of the practice itself.

Housing Inflation Is Outpacing Wages

The speed of price growth relative to earnings remains a core problem — though the picture is more nuanced than headlines suggest.

Property price growth has been decelerating. The national Residential Property Price Index rose 6.2% in the 12 months to April 2026, down from 6.7% in March and 7.1% in January, the CSO reported. February 2026 also recorded a 0.2% monthly fall — the first monthly decrease since May 2023.

But prices are still rising faster than pay. Average weekly earnings rose 4.4% year-on-year to €1,074.61 in Q1 2026, following a 3.1% rise in Q4 2025, according to CSO Earnings and Labour Costs data. That leaves a persistent gap of roughly two percentage points a year between house price inflation and wage growth.

The wage–price gap

Sources: CSO Residential Property Price Index; CSO Earnings and Labour Costs.

Regional divergence matters too. In the year to April 2026, Dublin prices rose 5.4% while prices outside Dublin rose 6.9%, with the Midlands recording the fastest house price growth at 12.5%. Apartment prices are rising faster than houses nationally, reflecting demand for cheaper entry points.

The new-build premium compounds the problem. The median new dwelling price was about €440,000 in the 12 months to December 2025 — roughly €85,000 above the median existing dwelling price, per the BPFI Housing Market Monitor.[bpfi]

The Supply Pipeline Is the Overlooked Risk

Completions are rising. Commencements are collapsing. That divergence is the most consequential and least discussed fact in Irish housing right now.

A total of 36,284 new dwellings were completed in 2025, up 20.4% and the highest annual figure since 2009, the Department of Housing confirmed. Apartment completions rose 38.7% to 12,047.[gov]

But new housing starts fell to 16,412 in 2025, down from 69,311 in 2024, when activity surged ahead of the expiry of development levy waivers, according to the BPFI. Because units commenced in 2024 must be completed by end-2026 to qualify for those waivers, the BPFI expects output to reach nearly 39,000 units in 2026 — after which the pipeline thins considerably.

For first-time buyers, this means the current improvement in supply may be temporary.

The Homebuying Process Itself Adds Stress

Financial pressure is only part of the problem. The ESRI/CCPC research quantified the process friction for the first time.

According to the CCPC, 63% of people who had previously bought a property in Ireland experienced at least one major stressor. Among those who bought within the last three years, that figure rose to over 80%.

Conveyancing delay is the primary driver. One-third of second-hand buyers reported significant delays in the legal transfer of property, while over a quarter of new-build buyers faced delays moving in, the Law Society Gazette reported on the study. Conveyancing delays were the single most common stressful problem for buyers and sellers alike.

The scale of the gap between expectation and reality is documented officially. The typical conveyancing timescale from sale agreed to closing runs from 10 to 20 weeks, and following the 2024 Conveyancing and Probate Expert Review Group, a national target of eight weeks has been set, according to gov.ie guidance.

Knowledge gaps compound the stress. The ESRI found that only one in five buyers knew that estate agents can legally continue to market a property that is sale-agreed, and fewer than half knew that a buyer can withdraw without penalty before contracts are signed. More than two-thirds did know it is illegal for a seller to accept multiple deposits on the same property.

Trust levels reflect this. CCPC data cited in the study shows just 22% of people trust estate agents and 16% trust second-hand sellers, with solicitors and engineers the most trusted figures in the process.

Myth vs Fact: What Irish Buyers Get Wrong

Renting Offers Little Relief

For many, rent levels make buying look financially preferable — if a property can actually be secured.

The standardised average rent for new tenancies in Dublin stood at €2,232 per month in Q4 2025, against a national average of €1,755, according to the RTB Rent Index, which is compiled with the ESRI. National new-tenancy rents rose 5.0% year-on-year.

Open-market asking rents are higher still. The Daft.ie Rental Report for Q1 2026 put the average monthly rent for a two-bedroom apartment in Dublin at €2,536, and €2,176 nationally, with market rents now 40% above pre-Covid levels.

The RTB also documents a two-tier market: new tenants nationally paid €1,755 in Q4 2025, 16.8% more than the €1,503 paid by existing tenants. Renters who move — including those saving for a deposit — face the higher tier.

State Supports: What Is Actually Available

Two schemes materially change first-time buyer economics, and both have expanded significantly.

Help to Buy provides a refund of income tax and DIRT of up to €30,000 or 10% of the property value, whichever is lower, on new-build homes valued at €500,000 or less. It runs to the end of 2029. Revenue statistics record 64,365 approved claims to date, worth approximately €1,459 million, with an average approved property value of €363,600. Department of Finance figures show 46,112 claims approved between July 2020 and April 2026, benefiting 83,644 people, RTÉ reported.[revenue][rte]

The First Home Scheme, a shared-equity scheme launched in July 2022, had issued over 11,000 approvals and supported almost 6,000 home purchases by mid-2026, according to RTÉ’s report on the scheme’s latest update. The average purchase price of a supported home is about €392,000, with average support of roughly €67,000 — 17% of the purchase price.[rte]

Both schemes apply overwhelmingly to new-build homes, which is where State and institutional competition is most concentrated. That is the structural tension at the heart of Irish first-time buyer policy.

First-Time Buyer Checklist: Protecting Yourself in the Current Market

Before you bid

• Confirm your maximum borrowing under Central Bank limits: 4x gross income for first-time buyers, 10% minimum deposit, with exceptions available to only a minority of applicants.
• Check Help to Buy eligibility early — the developer must be a Revenue-approved qualifying contractor.
• Register interest in the First Home Scheme if buying new-build; approval takes time.
• Set a written walk-away number before viewing, and treat it as fixed. ESRI evidence shows open bidding pushes 61–65% of buyers past their intended budget.

During bidding

• Ask the agent in writing how bids are verified and whether other bids are from approved buyers.
• Record every bid with date, amount and source.
• Remember that visible real-time bidding is associated with the largest price escalation, not the smallest.

After sale agreed

• Understand that sale agreed is not legally binding. The property can continue to be marketed and either side can withdraw before contracts.
• Instruct a solicitor immediately and ask for a written target timeline against the eight-week national target.
• Budget for a 10–20 week conveyancing period as the realistic range.
• Commission a structural survey; CCPC research found 57% of buyers who discovered a problem after closing would have lowered their offer or withdrawn had they known.

Frequently Asked Questions

How much can a first-time buyer borrow in Ireland in 2026?
Up to four times gross annual income, with a minimum 10% deposit and a maximum 90% loan-to-value, under the Central Bank of Ireland’s mortgage measures. Lenders may exceed the limits for up to 15% of first-time buyer lending, but only 5.3% of FTB loans exceeded four times income in 2024.[centralbank]

Is “sale agreed” legally binding in Ireland?
No. Neither party is bound until contracts are signed. Agents can legally continue to market the property, and buyers can withdraw without penalty. ESRI research found only one in five buyers understood the first point.

Are house prices in Ireland still rising?
Yes, but more slowly. Annual growth was 6.2% in the year to April 2026, the lowest since February 2024, per the CSO, and February 2026 recorded the first monthly decline since May 2023.

What share of new homes do first-time buyers actually get to bid on?
Roughly one-third of new supply reached private households on average between 2020 and 2025, versus 57% in the preceding six years, according to Sherry FitzGerald research.

Which bidding system results in the lowest price?
Sealed bids. In the ESRI experiment, sealed bids produced offers about €7,000 above baseline valuation, compared with roughly €13,500 through an estate agent and up to €16,000 on online platforms.

How long does conveyancing take in Ireland?
Typically 10 to 20 weeks from sale agreed to closing, against a national target of eight weeks set following the 2024 Conveyancing and Probate Expert Review Group, per gov.ie.

Is it cheaper to buy than to rent in Ireland?
It depends heavily on location and deposit position. Average Dublin new-tenancy rent was €2,232 per month in Q4 2025 (RTB), while the median national dwelling price was about €390,000 (CSO). The binding constraint for most renters is deposit accumulation and access to stock, not monthly affordability.

Why This Matters Beyond Real Estate

Housing outcomes now sit at the centre of Ireland’s broader economic policy debate. The Central Bank has explicitly framed its mortgage measures as a financial stability instrument, noting when it eased first-time buyer limits in 2023 that the change would, all else equal, produce a “modest increase” in property prices — an acknowledgement that demand-side supports interact directly with price levels.

The measurable pressures documented above — a shrinking open-market share of new supply, a persistent gap between price growth and wage growth, a second-hand market at a five-year low in transaction volume, and a commencements pipeline that has fallen by three-quarters in a single year — are structural, not cyclical.

Claims that Ireland’s housing situation is driving emigration, workforce instability or measurable mental-health harm are frequently made in public debate, but robust national data isolating housing as the cause is limited. Those effects are plausible and widely reported anecdotally; they should not be presented as established quantitative findings.

Final Thoughts

Ireland’s housing challenge is no longer simply about high prices. The verified evidence points to a market defined by four measurable structural features:

• Constrained open-market supply — roughly one-third of new homes reaching private households, down from 57% a decade ago
• Institutional and State competition — 12,857 homes bought by non-households in 2025, with public bodies the largest single purchaser
• A bidding system that inflates prices — experimentally demonstrated by the ESRI across all three formats used in Ireland
• Process failure after agreement — 80%+ of recent buyers reporting a major stressor, driven primarily by conveyancing delay

Record first-time buyer approval numbers show demand is not the problem, and Irish buyers are not financially irresponsible. The constraint is the structure of the market they are approved to enter.

Sources

1. Economic and Social Research Institute. Buying and Selling Property in Ireland: Behavioural Evidence on Bidding Systems, Stressors and Market Comprehension. Research Series No. 226, February 2026. Robertson, D., Shier, A.J., Timmons, S. and Lunn, P. — https://doi.org/10.26504/rs226
2. Competition and Consumer Protection Commission. New report highlights knowledge gaps and delays in Ireland’s homebuying market. February 2026 — https://www.ccpc.ie/business/new-report-highlights-knowledge-gaps-and-delays-in-irelands-homebuying-market/
3. Competition and Consumer Protection Commission. Room for Improvement: Examining information availability in residential property purchases. July 2025 — https://www.ccpc.ie/business/wp-content/uploads/sites/3/2025/07/CCPC-Homebuying-Research-Report.pdf
4. Economic and Social Research Institute. Buying and selling houses in Ireland: Behavioural economic evidence for reform. October 2025 — https://www.esri.ie/publications/buying-and-selling-houses-in-ireland-behavioural-economic-evidence-for-reform
5. Central Statistics Office. Residential Property Price Index, February 2026. April 2026 — https://www.cso.ie/en/releasesandpublications/ep/p-rppi/residentialpropertypriceindexfebruary2026/
6. Central Statistics Office. Residential Property Transactions by Non-Households 2025. July 2026 — https://www.cso.ie/en/releasesandpublications/ep/p-rptnh/residentialpropertytransactionsbynon-households2025/
7. Central Statistics Office. Earnings and Labour Costs, Q1 2026 preliminary estimates. 2026 — https://www.cso.ie/en/releasesandpublications/ep/p-elcq/earningsandlabourcostsq22025finalq32025preliminaryestimates/
8. Banking & Payments Federation Ireland. BPFI Housing Market Monitor Q4 2025. March 2026 — https://bpfi.ie/wp-content/uploads/2026/03/BPFI-Housing-Market-Monitor-Q4-2025.pdf
9. Residential Tenancies Board / ESRI. RTB Rent Index Q4 2025. May 2026 — https://rtb.ie/wp-content/uploads/2026/05/RTB-Rent-Index-Q4-2025.pdf
10. Daft.ie. Daft.ie Rental Report Q1 2026. May 2026 — https://www.rte.ie/documents/news/2026/05/daft.ie-rental-report-2026q1.pdf
11. Central Bank of Ireland. What are the mortgage measures. 2026 — https://www.centralbank.ie/consumer-hub/explainers/what-are-the-mortgage-measures
12. Revenue Commissioners. Help to Buy (HTB) incentive monthly statistics. June 2026 — https://www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/help-to-buy-stats.pdf
13. Department of Housing, Local Government and Heritage. Over 36,200 new homes completed in 2025. January 2026 — https://www.gov.ie/en/department-of-housing-local-government-and-heritage/press-releases/minister-browne-welcomes-over-36200-new-homes-completed-in-2025/
14. Department of the Taoiseach. Finding a property and avoiding common delays. 2025 — https://www.gov.ie/en/department-of-the-taoiseach/publications/finding-a-property-and-avoiding-common-delays/
15. Bank of Ireland. Housing Update, May 2025 — https://personalbanking.bankofireland.com/app/uploads/Bank-of-Ireland-Housing-Update-May-2025.pdf
16. Sherry FitzGerald research on new-home buyer composition, reported in The Irish Times, June 2026 — https://www.irishtimes.com/business/2026/06/13/private-buyers-squeezed-out-as-state-and-investors-take-growing-share-of-new-homes/
17. The Irish Times. Companies, public bodies and charities bought one in five homes sold in 2025. July 2026 — https://www.irishtimes.com/business/2026/07/01/companies-public-bodies-and-charities-bought-one-in-five-homes-sold-in-2025/
18. TheJournal.ie. ‘Auction fever’ leading some Irish homebuyers to bid more. February 2026 — https://www.thejournal.ie/online-bidding-houses-prices-6949488-Feb2026/
19. Law Society Gazette. Lack of legal literacy causes home-buyer distress. February 2026 — https://www.lawsociety.ie/gazette/top-stories/2026/feb/lack-of-legal-literacy-causes-home-buyer-distress/
20. MyHome.ie and Bank of Ireland. Improving Ireland’s Homebuying Process, December 2025, reported in The Irish Times — https://www.irishtimes.com/business/2025/12/08/poor-information-depresses-number-of-house-sales-report-finds/
21. RTÉ. Over 11,000 buyers now approved under First Home Scheme. July 2026 — https://www.rte.ie/news/business/2026/0706/1581968-first-home-scheme-progress-report/
22. RTÉ. 46,000 households used ‘Help to Buy’ scheme since 2020. May 2026 — https://www.rte.ie/news/business/2026/0501/1571286-46-000-households-used-help-to-buy-scheme-since-2020/
23. McWilliams, D. Houses are being built in Ireland, so why can’t ordinary people buy them? The Irish Times, August 2025 (opinion) — https://www.irishtimes.com/opinion/2025/08/23/david-mcwilliams-houses-are-being-built-in-ireland-so-why-cant-ordinary-people-buy-them/