Key Takeaways
| Trend | Detail |
|---|---|
| Price Inflation | National property prices up 12.3% year-on-year, the sharpest in a decade |
| Listings Shortage | Only around 51,000 second-hand homes now vs. 67,000 in 2019 |
| Supply Deficit | Just over 12,000 homes for sale nationally at the end of Q2 2025 A healthy Irish market typically needs 30,000+ |
| Non-Standard Housing Outlook | Modular homes and techniques likely to see growing demand due to affordability and faster delivery |
Daft.ie’s Q2 2025 Housing Report.
On June 23, Daft.ie released their quarterly report on the state of the Irish housing market. Please see the full report HERE.
It is no surprise to us that prices were still rising, however, it was surprising for me to find out that the new 12.3% rise (compared to this same time last year) is currently the highest it’s ever been since 2015.
This 12.3% rise in property prices, across all of Ireland, continues to mirror a market that has very limited supply and incredibly high demand. There are too few second-hand homes and new builds entering the Irish market. For context, only 51,000 second-hand homes were listed in the last year, a significant drop from pre-Covid levels of 67,000 in 2019.
Also, construction remains slow in Ireland due to:
- High interest rates – Ireland’s interest rates are the 5th highest in the EU right now.
- Slow Planning Approvals – The Irish planning system is well-known for its incredibly slow progress. I cannot help but feel that the Planning Framework is deliberately designed to limit the construction of new developments.
- Infrastructure constraints (like water and electricity shortages) – Unfortunately, even when developers are given planning approval to build, there are instances where roads, water or electricity cannot be delivered to the sites. Especially in rural areas.
- Hesitant developers – due to all the above, including tight profit margins and rising construction costs. Another fear among small and medium developers could be that if they build now, only for prices to potentially fall, this could leave them exposed financially.
- Shortage of skilled labour – Due to the rise in prices of everything post-COVID, Ireland has had to see a lot of its talent emigrate to countries like Australia.
As a result, national house prices have climbed 40–60% higher than early 2020 levels. While Dublin shows minor signs of stable supply, other regions continue to face deep housing pressure.
What is a PESTLE Analysis?
A PESTLE analysis is one of many strategic frameworks you can use, when trying to analyse the external factors that could impact a sector. It stands for:
- Political
- Economic
- Social
- Technological
- Legal
- Environmental
In the context of this blog post, a PESTLE analysis can help us better understand why alternative living, especially modular homes can become relevant in Ireland.
What are the Possible Implications for Modular Housing in Ireland?
Political
- The Government’s annual 50,000 housing target remains unmet (closer to 30,000).
- Could this supply shortage eventually push more public interest and local authorities towards MMC (Modern Methods of Construction) to meet their own targets?
- For instance, could the Taoiseach’s recent support of modular construction projects (e.g. CPAC Modular in Meath) signal a future policy shift towards modern methods of construction?
- A failure to structurally fix the housing crisis may force the government to support modular construction formally. We may even see modular social housing schemes become a default policy rather than an exception.
Economic
- Property prices are 12.3% higher year on year and 40% higher since Covid, so traditional homeownership is increasingly out of reach for most people.
- This creates a market opportunity for modular homes, which can be built in less than half the time it would take for standard housing. (With material and labour prices as they are now, I do not have concrete evidence to prove that these homes might also be cheaper).
- The fast build-time of modular homes would greatly increase supply and help to stabilise house prices. Fixed-income retirees, downsizers and young professionals can benefit from these homes.
- In the future, banks and insurance firms may begin offering more mortgages and cover for modular homes, especially if they prove resilient and in-demand.
Social
- Delayed independence for young adults (many living with parents into their 30s), and many young couples delaying their plans to start families as they cannot afford homes.
- Rising emigration and homelessness, especially in cities like Dublin.
- This could lead younger families and first-time buyers to look at non-standard alternatives such as quick-builds, adaptable and/or and tiny homes. Unfortunately, this would probably also require you to own the land and needing planning permissions.
- In the long term, the current stigma around modular or tiny homes is likely to reduce. Particularly as quality and aesthetics improve and more people seek flexibility and affordability.
Technological
- A growing interest in factory-built modular homes is expected. I cannot see it any other way. Under proper management, these methods deliver homes faster, great energy performance, and also align with net-zero housing goals.
- All the above may drive down costs and gain public trust. Medium-sized companies like Rayco Group and CPAC Modular may start to lead county-level delivery schemes.
Legal
- In February 2025, the government announced it will seek planning exemptions for some detached modular cabins. Though it is still a very far cry from actual dignified homes needed, Irish planning and development rules are slowly being amended to accommodate full social modular homes.
- Over time, we can expect more inclusive definitions of “permanent residence” in housing regulations. This could allow for modular residences and possibly even tiny homes to be more easily approved.
Environmental
- If you go to any Irish modular supplier’s website, you will find that modular and eco-homes are marketed as sustainable homes (i.e, homes that are built with waste reduction in mind). With water shortages becoming more common, these housing models could become more popular, especially in rural areas.
- Through its Climate Action Plan 2024, Ireland’s is already pushing for 500,000 homes to be retrofitted to a B2 Building Energy Rating (BER) by 2030. Water shortages and grid pressure due to data centres may push developers and homeowners to go for housing models that try to reduce greenhouse emissions.
Conclusion – Visual Snapshot – Irish Housing Market vs Ideal Supply
| Metric | Current | Ideal |
|---|---|---|
| Total Homes for Sale (June 2025) | 12,000 | 30,000+ |
| Year-on-Year Price Growth | +12.3% | +3–5% (sustainable) |
| Average Price Rise Since 2020 | 40–60% | <10% (ideal) |
Daft.ie’s Q2 2025 housing report makes one thing clear – the old system isn’t working fast enough. As second-hand listings continue to stagnate and new builds remain slow, modular homes and other non-standard housing options are the fastest way to increase current supply.
With the right policies, public education, and quick political action, Ireland can take advantage of the benefits of modular construction, provide much needed housing and stabilise prices.
