The Irish Government has today published “Delivering Homes, Building Communities 2025–2030” (the Plan), its much-anticipated housing strategy that introduces reforms aimed at boosting supply, improving viability and creating a more stable investment environment. While the Plan includes several material changes for PRS investors and developers – particularly those focused on multi-unit apartment schemes – many of these changes have already been announced over the course of the year and will not therefore be unexpected.
Overall aims
The Plan aims to activate large-scale supply across all tenures, drive down the cost of building new homes (particularly apartments), strengthen protections and supports for renters and provide a more predictable regulatory and investment environment. The overall stated target is to support the delivery of 300,000 homes over the five-year lifetime of the Plan, although it is worth noting that annual targets have been done away with.
The Government recognises that an estimated €20 billion in development finance will be required to support the delivery of these homes and that the significant majority of the required funding will need to come from investment by the private sector, to support both home ownership but also a well-functioining private rental market.
Key features
A more predictable rent framework
One of the key interventions from the Government’s perspective is the introduction of a new national system of rent controls. As previously reported, for most properties annual rent increases will be capped at 2% or inflation (CPI), whichever is lower. Crucially, however, new-build apartments will operate under CPI-linked increases only, recognising the need to attract and retain investment in new rental stock. The ability to reset rents to market levels between tenancies is also intended to help stimulate investment.
Stronger tenant protections
The plan also references the intention to introduce minimum six-year tenancies, with rent reviews allowed at the end of each term. While termination grounds will tighten, institutional landlords – already aligned with long-term occupancy models – are unlikely to be adversely impacted. These reforms aim to provide tenants with security while supporting investor confidence through regulatory clarity.
Reductions in apartment delivery costs
The Government’s main boost for viability comes through a package of cost-reduction measures which we have already flagged during the year, including:
- VAT on apartment construction cut to 9%;
- Enhanced corporation tax deduction for qualifying construction and conversion costs;
- Revised apartment design standards offering greater flexibility and lowering build costs; and
- Standardised design approaches and increased support for modern methods of construction.
According to Government, the combination of these measures has the potential to reduce delivery costs by €88,000 to €160,000 per apartment, substantially improving the economics of large-scale schemes.
Planning reform and supply activation
The ongoing implementation of the Planning and Development Act 2024 will introduce statutory decision timelines, increased resourcing for planning bodies and greater certainty for developers. The creation of Urban Development Zones is also intended to unlock sites capable of supporting high-density apartment delivery.
Unlocking infrastructure
The Plan places a strong emphasis on unlocking infrastructure constraints that have slowed housing delivery, to include the introduction of a new €1 billion Infrastructure Investment Fund and dedicated national structures to accelerate enabling works. This is in addition to the formation of the Housing Activation Office, which is specifically tasked with removing infrastructure delays. The overall aim is to ensure that infrastructure keeps pace with high-density development.
Cost rental expansion
The Government will significantly scale up cost rental delivery through enhanced funding streams, a new corporation tax exemption for cost rental income and changes to the STAR equity model.
Student accommodation
The Plan also places renewed focus on student accommodation, with a Student Accommodation Strategy 2025–2035 to be published shortly. This is to be aimed at significantly expanding purpose-built supply and reducing the number of students competing in the private rental market.
Land Development Agency
The Plan also significantly scales up the role of the Land Development Agency (LDA), with an additional €2.5 billion in equity funding bringing its total capital allocation to €8.75 billion . The LDA’s remit is expanded to cover a wider geographic area, acquire more public and private land and invest directly in enabling infrastructure.
What this means for PRS stakeholders
Overall, the plan signals a clear policy shift toward:
- Greater certainty for purpose-built rental schemes;
- Improved viability through substantial cost reductions and tax measures;
- A more transparent and regulated rental environment;
- A stronger pipeline for both private and mixed-tenure apartment delivery.
For investors, developers and operators in the multi-unit rental sector, the reforms represent one of the most supportive policy landscapes in recent years. There is, however, still much work to be done in operationalising these new policies and further analysis will be required as each strand progresses.
If you have any queries, please contact Aoife Smyth, Practice Development Consultant, or your usual ALG Real Estate contact.