The Economic and Social Research Institute (ESRI) has released a new report suggesting between 35,000 and 53,000 new homes are needed annually to keep up with housing demand. While the government has aimed to build 33,000 new houses each year, with the intention of rising to 40,000 by 2030 under its Housing for All strategy, it is now considering revising its housing goals as part of Budget 2025. The new ESRI research unveiled on Tuesday examines a variety of potential outcomes for housing demand in the Republic.
The study looks into the trajectory of housing demand across 12 potential population scenarios, taking into account varying assumptions about the birth rate, death rate, and in-migration. The average housing demand projected by all 12 scenarios suggests a need for 44,000 homes each year until 2030, followed by 40,000 a year for the subsequent decade, according to the ESRI.
The baseline scenario projected by the research indicates a population growth of more than 1% per year, which is high compared to other nations. This could raise the housing demand to between 38,000 and 50,000 homes per year. However, the demand could increase to as much as 53,000 homes in scenarios with higher migration rates, as indicated by the report.
Paul Egan, the report’s co-author and associate research professor at the ESRI, emphasised the uncertainty of housing demand predictions and stated that the study took various scenarios into consideration. He also made it clear that the report only considered future demographic projections and did not include the current pent-up demand for housing.
Adele Bergin, the report’s co-author and associate research professor at ESRI, noted the significant impact housing demand now and in the future has on housing policy, regarding both the number of houses needed and their required locations. Her research indicates that an average of 44,000 new homes per year is necessary to cope with population growth across a variety of scenarios.
The research suggests that by 2030, about half of Ireland’s housing demand will be concentrated in Dublin and Cork local authority zones. The Economic and Social Research Institute (ESRI) stated that despite substantial rates of recent migration, population growth across the country remains irregularly distributed.
The examiners of the report mentioned that the primary determinant of population shifts in Ireland is net migration, which has been particularly robust in recent years. Whilst all regions have seen population increases, this growth has not been uniformly spread throughout the nation. Between 2016 and 2022, the population on a national scale grew at an average yearly rate of 1.4 per cent, while the eastern and midlands region saw the greatest growth of 1.6 per cent.
Earlier this year, Minister of State for Housing Malcolm Noonan informed the Dáil that advancements were well underway in revising housing objectives, which are projected to be sanctioned by the government and disclosed this autumn. The upcoming target is estimated to sit at approximately 50,000 homes, aligning with the numbers suggested by the Housing Commission’s report in May. Upon his appointment as Fine Gael’s leader and Taoiseach in April, Simon Harris committed to the creation of 250,000 new houses between 2025 and 2030.
In a recent report, the Department of Finance anticipated that generating 50,000 houses would incur a yearly development finance cost of €20 billion. It highlighted that the majority – roughly €16.9 billion – would need to come from private funding.