2023 Housing Market Predictions

A year of lenders rising their rates and a lack of housing available to purchase. It’s been a tough one. The 2023 housing market predictions better be pleasant, we hear you say.

What is in store for the new year? Will there be an increase in supply? Will there be a continued shortage of building materials and labour? Is now a good time to buy? These are all common questions that we have been receiving from our followers on social media. We do not have a crystal ball to see if 2023 will be a better year for the housing market. However, we can analyse what economists are predicting and use reports to form a forecast.

Continue reading to find out Mortgage123’s 2023 housing market predictions.

New Housing Supply

The price of Raw materials such as timber and steel was badly impacted by inflation which currently shows no sign of slowing down. As a result, this may put further pressure on the development of new homes in 2023.

A new purposed levy on concrete blocks, as part of the Budget 2023, is to take effect. This will have a negative impact on self-build projects or renovations. Also, this will no doubt have an impact on what prices prospective homebuyers will have to pay. A new levy on concrete blocks will add up to €1,600 towards the building costs of a three-bed semi-detached house, according to the Department of Finance.

The new levy was to come into effect in April 2023 but is now expected to be delayed until August or September 2023.

Also, the number of planning permissions granted for new homes has sharply declined which is impacting supply. There was a decrease of 41% in the number of new dwellings given planning permission in the third quarter of 2022 compared to the same time last year according to Statistics from the Central Statistics Office. There was a big drop of 67% in the number of apartments granted permission.

The demand for New Build properties will continue to be strong in 2023. The reason for this is the extension of the Help to Buy Scheme to the end of 2024 and also the First Home Scheme. Both of these scheme are applicable only to newly built properties; hence, the demand.

Increase of Owner-Occupier Market

Buyers will be especially active from January 2023 onwards due to easing of the Central Banks rules which will now see first time buyers being approved to borrow up to four times their income. As a result, the first time buyer market may become even more competitive.

Therefore, January will be a particularly strong month for the owner-occupier market as it will see first time buyers taking advantage of the new lending rules.

Second Hand or Derelict Properties

Small investors and landlords will continue to exit the market. This will result in a lot of second-hand rental properties coming to the Irish market. It is predicted that a number of vacant properties in particular will be on the market from January 2023 onwards due to the Government enforcing a new vacant homes tax.

It is believed this new tax is to increase the supply of housing to help combat the housing crisis by encouraging property owners to either sell or rent homes that are occupied for less than 30 days in a 12-month period.

2023 Housing Market Predictions – House Prices

The European Commission stated in their European Commissions’ Post-Programme Surveillance Report for Ireland that houses in Ireland aren’t overpriced. It’s a supply problem. Perhaps with an increase of more second hand properties coming onto the market, there may be a slight drop in property prices due to an increase in supply.

According to the latest figures from the MyHome.ie property report, the annual asking price of properties was up 7.8 % in the third quarter of the year. It also noted a 46 % increase in properties that were for sale in September compared to the start of the year.

Lorcan Sirr, a lecturer in housing studies at Technological University Dublin, said he predicts house price inflation to drop to 5 – 7 % this year, falling to in or around 2 % in 2023.

Rising Mortgage Interest Rates

The European Central Bank raised interest rates for the fourth time in a row on the 15th of December by 0.5 %. This new rate increase will add €600 a year to the mortgage bills of a homeowner on a 30-year tracker mortgage of €200,000.

The main lenders have not yet hiked their variable rates in response to any of the previous ECB increases. However, it is highly likely that we will see lenders raising their rates from January 2023 onwards. By how much? That is a question we are unable to predict currently.


Our 2023 housing market predictions are that we may see further lenders rising their rates. Second hand properties will also be a popular choice for buyers in 2023. This is due to an increase in supply due to new government regulations. Property prices may start to slowly stall or decrease due to an increase in supply. However, nothing is for certain in this constantly evolving housing market.

There is one thing that is for certain though. If you are looking to get on the property ladder, you should get a broker. We predict further rate rises so don’t rely on just the one bank for your mortgage. Go get a broker. We may be one broker, however, we have access to all banks. Therefore, you are guaranteed the best rate on the market!


Apply online today for a mortgage or contact us on (061) 599990 if you are thinking of stating your journey.

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