The Central Statistics Office (CSO) disclosed on Wednesday that last year saw property investors and financial firms reduce their acquisitions of Irish homes compared to prior years, while the national government increased its procurement of both new and pre-existing properties.
Based on records submitted to the Revenue Commissioners, the CSO’s latest data reveals that 12,201 residences were purchased in the last year by non-domestic bodies. These include private firms, investors, and government agencies. There was a decrease of nearly 10% in the number of purchases from 2022, a year which boasted the highest transaction rate in at least half a dozen years, the CSO stated.
In 2023, non-domestic entities accounted for €4.2 billion worth of property sales, with state organisations and government branches purchasing 5,778 homes amounting to €1.9 billion. This marked the largest share of transactions from any sector. The CSO noted an approximate increase of 25% from 2022 in the number of state-acquired homes.
Following closely, the financial and insurance industry ranked as the second-most substantial home buyer, with 2023 transactions totalling €853 million, a significant decrease from over €1.5 billion in 2022.
Lastly, Irish-registered firms and other organisations accounted for 92% of the €4.2 billion spent on home purchases last year. The remaining €302.5 million was made up by entities registered abroad, with European investors being the leading foreign purchasers of residential properties, making up more than 82% of the total value, as per the CSO’s report.
Niall Corkery, a statistician from CSO, stated in 2023 that there were 12,201 residential property acquisitions by non-household entities. Of this number, 6,438 represented house transactions with 43.4% (2,797) of these being new homes. The remaining 56.6% (3,641) were pre-existing homes bought in the same year.
In 2023, the surge in interest rates made private investors cautious as it reduced the borrowing capacity to finance deals. This caused a significant drop in transaction values in the residential investment market to a mere €433 million, as noted by an earlier BNP Paribas Real Estate report. This figure stood in stark contrast to the previous average of nearly €2 billion from the 2019 to 2022 period.
Added to this were rent control measures and a rise in government-led operations in the privately rented sector through housing bodies, contributing to the market slowdown. The report explained that these factors have made government agencies an increasingly favourable alternative for property developers.