Budget 2026 — Housing Measures
Key Housing Policy Changes in Ireland
Ireland’s Budget 2026 introduces a comprehensive set of measures aimed at increasing housing supply, supporting renters and homeowners, reducing construction-related tax burdens, and expanding long-term rental options.
The Government continues the Housing for All strategy with a focus on affordability, rental stability, and revitalisation of vacant and derelict propertis.
Below are the main Housing measures in Budget 2026.
1. VAT on New Apartment Construction Reduced to 9%
From October 2025 until 31 December 2030, the VAT rate for the construction of new apartments is reduced to:
9% (down from 13.5%)
Objectives include:
increasing the pace of apartment construction,
lowering development costs,
encouraging developers to initiate new multi-unit projects.
This is one of the most significant measures in the housing section of the budget.
2. New Cost Rental Scheme Incentives
The Government is introducing enhanced measures to support Cost Rental developments, where rents are set at levels that cover costs rather than market rates.
Supports include:
tax incentives for operators,
improved financing terms,
expanded access to State grants.
The aim is to grow a stable, affordable long-term rental sector.
3. Supports for Homeowners and Mortgage Holders
Mortgage Interest Relief extended to 2026
The relief for homeowners with mortgages is extended, with a gradual phase-down.
It remains an important support for thousands of households.
Rent Tax Credit extended to 2028
Available at:
€1,000 for individuals
€2,000 for couples
This measure continues to support private renters across the country.
4. Introduction of the Derelict Property Tax
A new Derelict Property Tax is being introduced to replace the Vacant Sites Levy.
Its objectives are:
returning unused and derelict buildings to productive use,
encouraging owners to renovate, sell or redevelop their properties,
helping address housing shortages through regeneration.
5. Supports for Homebuyers
Budget 2026 also includes continued measures to support those purchasing homes, particularly first-time buyers.
Key areas include:
wider access to the First Home Scheme,
ongoing support for purchases of properties requiring renovation,
improved availability of shared-equity programmes.
6. Strengthening the Rental Market
Several measures aim to improve stability and quality within the rental sector.
They include:
improved minimum standards for rental properties,
supports for upgrading rental accommodation,
continuation of Rent Pressure Zone (RPZ) protections,
financial incentives for long-term rental supply.
7. Expansion of Social and Affordable Housing
The Government is increasing funding for:
local authority housing projects,
social housing construction,
affordable housing schemes.
Funding covers both new builds and refurbishment of existing units.
8. Energy Efficiency and Renovation Supports
Budget 2026 expands incentives for home renovation and energy efficiency upgrades:
increased grants for insulation and deep retrofits,
financial supports for older homes requiring renovation,
expanded schemes for improving the energy performance of rental properties.
These measures aim to improve housing quality and reduce energy costs.
Summary of Housing Priorities in Budget 2026
Budget 2026 focuses on four primary housing pillars:
Increasing housing supply through reduced VAT and development incentives
Supporting long-term rental affordability via Cost Rental measures
Improving access to ownership through buyer and mortgage supports
Revitalising the existing housing stock with grants, retrofitting schemes and a derelict.