Central Bank Warns: Government Will Miss 300,000 Housing Target

UPDATE: The Central Bank of Ireland has issued a stark warning: the government is unlikely to meet its ambitious target of delivering over 300,000 new homes by 2030. This urgent forecast, released in the Central Bank’s latest quarterly bulletin, indicates that the current pace of housing delivery poses a significant risk to the nation’s economic growth.

Today’s report highlights that housing completions are projected to reach only 32,500 this year, with modest increases to 36,000 in 2026 and 40,000 in 2027. These numbers are a downward revision from previous estimates, which had anticipated 37,500 homes in 2026 and 41,500 in 2027. The Central Bank warns that without a dramatic acceleration in construction, the government would need to deliver over 97,000 homes annually in 2028 and 2029—essentially tripling current expectations.

Martin O’Brien, a researcher with the Central Bank, stated, “It’s certainly got to be a challenge to meet those kinds of targets.” He emphasized that the delivery of essential infrastructure like water and energy is critical to support such housing activity. With Ireland’s population on the rise, wastewater generation in greater Dublin is expected to climb by over 50% in the next 25 years, compounding the urgency of this situation.

Electricity demand is also projected to soar, with EirGrid forecasting a potential increase of 45% by 2034. O’Brien cautioned, “If the challenges that we’re seeing in water and energy, and ultimately in housing, aren’t resolved over the medium term, then it becomes a constraint on economic growth.” The lack of available housing is now impacting both Irish and international businesses, leading to concerns about the ability to attract talent.

Between January and June 2023, over 15,000 new homes were delivered, slightly exceeding expectations. However, building commencements dropped to 6,325 during the first half of the year, a significant decline from 34,490 in the same period in 2024. The volatility in housing starts introduces considerable uncertainty regarding future completions, according to the Central Bank.

This grim report comes just weeks before the government unveils Budget 2026 and the new Housing for All plan. Analysts do not expect significant changes in housing strategy within this budget, but it is likely to reaffirm the government’s commitment to extending the Help to Buy and First Home Scheme until 2030. The budget is set to announce a €9.4 billion package, which includes €1.5 billion in tax cuts and €7.9 billion in spending, up 7.3% for next year.

Despite these figures, Taoiseach Micheál Martin suggested that economic uncertainty, particularly due to new US tariffs, may temper expectations. He acknowledged the need for targeted support instead of broad, untargeted measures.

Meanwhile, the Central Bank’s quarterly report also highlights potential challenges for the pharmaceutical industry due to US tariffs, projecting that growth in exports will be slower than anticipated. Following months of negotiations, a baseline 15% tariff on most European exports to the United States remains in effect, which poses risks for Ireland’s export-driven economy.

As the situation develops, the implications of the Central Bank’s findings will unfold, impacting not only housing policy but also economic growth across Ireland. The clock is ticking, and the need for actionable solutions has never been more pressing.