Ireland’s housing crisis is ‘on a different level’ to other countries around the world – with population growing four times faster than new homes are being delivered.

New research from Savills shows that for every new home delivered in Ireland, four new people are being added to the population.

The study compares Ireland to eight other advanced Western nations across a range of key housing metrics – population, housing supply, house prices, rents and affordability.

It finds that Ireland has the worst housing-to-population ratio of all the countries examined in the study.

The report notes that, while immigration has increased Ireland’s population, the country also has “by far” the highest natural population growth in Europe.

Population growth for every one unit of housing delivered, 2015 – 2023. Image: Savills

According to the report, some 3.8 people were added to the population for every new unit of housing delivered between 2015 and 2023 – a ratio of nearly four to one.

It makes Ireland’s population-to-housing ratio “by far the worst” of the eight countries analysed – 14% higher than the next worst country, which was Spain.

Ireland’s ratio was 80% worse than the United Kingdom’s and double Australia’s.

It is also significantly worse than the US and Germany, which had a ratio of less than one person for every new housing unit delivered.

"A different level"

The report notes that while housing shortages are common around the world, “Ireland really does stand out alone in its severity”.

“While it is true that many countries across the world are facing housing shortages, it is important to recognise that the severity of Ireland’s is on a different level to others,” said Savills Director of Research John Ring.

“Ireland has unique drivers – a delayed natural population boom, high migration due to strong economic growth and structural legacy issues resulting from the Celtic Tiger crash.

“That explains why Ireland has the unenviable position of having the worst supply-to-population growth of the countries analysed.

“At present, we are running to stay still and a more aggressive approach to promoting new housing supply is warranted compared to our peers.”

Housing

The report notes that Ireland, Canada and Australia have the fastest-growing populations among the countries studied.

Canada is also struggling to meet the housing demands of its population; however, it is doing significantly better than Ireland at 2.9 people per new home built.

Australia is faring even better again with a people-to-housing ratio of 1.9.

The report notes that, while immigration has fuelled Ireland’s population growth, the country also has “by far” the highest natural population growth in Europe.

Income growth and rental growth. Image: Savills

Savills said Ireland’s failure to build enough houses has seen house prices surging 66% between 2015 and 2022.

During the same period, incomes grew by just 27%.

The report notes that the difference between the two would have been even larger were it not for the Central Bank’s mortgage lending rules.

It warns, however, that those same rules have left many people stuck in the rental market – pushing rent prices up around the country.