Housing starts rose to more than 3,000 in December, twice the November figure, raising hopes that Government measures to kickstart construction are beginning to take effect.
The Department of Housing said 3,065 commencement notices for new homes were lodged, the highest rate for any month last year.
It comes as AIB’s latest purchasing managers’ index for the construction sector shows new orders returned to growth in December due to an increase in client demand.
Date from the Department of Housing indicated the total number of units commenced in 2025 was 16,412 units.
The number was considerably down on the 2024 total, which saw a sharp increase in activity resulting in a record 69,311 commencements.
This was, however, driven by the approaching end of development levy waivers and the Úisce Éireann connections rebate scheme.
The department noted how commencements across 2024 and 2025 combined came to 85,723 units, up 43 per cent on the previous two years.
Of the 3,065 units commenced in December, 979 (32 per cent) were scheme dwellings, 1,820 (59 per cent) were apartments and 266 (9 per cent) were for one-off units
The acceleration in overall housing supply between 2021 and 2023 was primarily driven by a pickup in apartment construction in the Greater Dublin Area.
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The current stagnation is similarly driven by a drop-off in apartment completions.
To stimulate activity in the sector, the Government has reformed the State’s system of rent controls, changed apartment design standards and cut VAT on new-build apartments.
“This strong jump in the delivery of new home starts at the end of 2025 is very encouraging and signals the uptick in confidence in the construction sector,” Minister for Housing James Browne said.
“We need to ensure we deliver on our ambitions of 300,000 new homes by 2030.
“This growing confidence across construction is built on decisive policy interventions we have taken since I became Minister for Housing last year.”
The Department of Housing said it also planned to show, as part of the monthly commencement data, how many starts intended to use modern methods of construction (MMC).
MMC refers to the use of off-site construction and prefabricated design technologies.
The department’s data indicated that from July to December last year MMC was intended to be used in 69 per cent of homes in scheme developments, with 61 per cent of these dwellings using timber-frame construction.
The data also showed it was intended for 44 per cent of new apartments to be constructed using MMC.
“These innovative new methods help deliver houses much faster and offer greater cost certainty while at the same time reducing building emissions,” Mr Browne said.
“I am particularly encouraged by the high usage of timber-frame construction. Along with the increased speed and efficiency of using MMC, the use of timber offers significant benefits in terms of sustainability.”