New housing starts fell by more than three-quarters last year, with activity slowing by almost 84 per cent in the key local authority areas of Fingal County Council and South Dublin County Council, according to a new report from the Irish banks.

The latest housing market monitor from Banking and Payments Federation Ireland (BPFI), which covers the final quarter of 2025, shows there were just over 16,000 housing commencements during the year, down from more than 69,300 in 2024.

BPFI chief economist Ali Uğur said the “steep decline” during 2025 presents “risks to future supply” beyond this year in the absence of a “significant rebound” in scheme and apartment commencements in 2026.

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He said the low level of commencements last year, particularly the 12,600 housing estate homes and apartments, points to a “likely reduction in output” in early 2027.

Uğur said the drop in commencements last year could be attributed to a surge in activity in 2024 as developers rushed to build in advance of the expiry of development-levy waivers.

Commencements fell sharply in key local authorities, particularly Dublin City Council, Fingal County Council and South Dublin County Council, with activity declining by almost 84 per cent in Fingal and South Dublin.

One-off dwellings accounted for 23 per cent of all starts, which was the highest share since 2018.

About 5,900 housing units were started in the last three months of the year, a year-on-year drop of 65.5 per cent.

On a more positive note, almost 12,000 new dwellings were completed in the last quarter of 2025. That represented a year-on-year increase of 38.5 per cent.

There were 36,284 housing completions in the year as a whole, which was 20.4 per cent more than in 2024 and the highest annual volume since the 12 months ending June 2009.

More than half of the annual increase was driven by a sharp rise in apartment completions – primarily in Dublin – where apartment output rose by over 46 per cent to more than 9,600 units.

One-off homes represented just over 16 per cent of national completions. However, in nine counties, they accounted for at least 40 per cent of all new dwellings.

Uğur said homes started in 2024 must be completed by the end of this year to qualify for levy waivers, so he expects overall housing output to reach nearly 39,000 homes in 2026 as long as “the strong momentum in construction continues”.

The data also show the number of residential units granted planning permission rose by 29.4 per cent to 11,142 in the third quarter of last year, the highest number since the second quarter of 2023.

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In terms of home sales, the number of existing properties sold fell for the third straight year to 38,502, the lowest level since 2020.

“Most home buyers purchase second-hand properties, with existing properties accounting for 76.1 per cent of household market purchases of residential property in 2025,” said Uğur.

“This implies that fewer second-hand homes are available to buy than in recent years but also that more homeowners may be staying in, and investing in, their current homes rather than moving.”

Residential property prices were up by 7 per cent in the year to December, following an 8.9 per cent increase in 2024. The median new dwelling price of €440,000 in December was about €85,000 higher than a year earlier.