The Galway Residential Market in 2025 experienced another active year of healthy sales, characterised by strong demand and weak supply. The number of second-hand residential properties that came to the market in 2025 had fallen by approximately 10 per cent on 2024, which in itself was a year of very tight supply. Tony Kavanagh commented, “This has resulted in creating a very competitive marketplace for potential buyers, often resulting in properties attracting multiple bidders and continuing capital price growth in the order of 8.2 per cent for 2025 in Galway.”
All price categories of the market have experienced this level of demand, from prime, upper-end locations of larger properties to starter homes and apartments. Sherry FitzGerald has concluded sales across all levels, achieving sales of one million euros or more in 2025.
The Irish economy continues to show resilience despite broader economic and geopolitical challenges throughout the year. Following a particularly strong start to 2025, the pace of economic growth has slowed as we moved through the year, largely due to significant declines in investment expenditure and goods exports, following the front-loading of exports to the US in Q1 in anticipation of new tariffs. That said, the economy is expected to perform strongly overall in 2025.
As has been the case for the last number of years, the Irish residential market remains characterised by supply-side challenges and ever-increasing demand, leading to robust price inflation. According to the Sherry FitzGerald Price Index, annual price growth in Galway at the end of September 2025 stood at 8.2 per cent, higher than the national average of 7.3 per cent.
Over the first nine months of 2025, 1,014 new dwellings have been completed across County Galway, which is an increase of 13.3 per cent when compared to the first nine months of 2024. Though new dwelling output in Galway has increased since last year, demand for new dwellings in the west region far exceeds the level of completions recorded in recent years. According to estimations by Sherry FitzGerald Research, the annual average housing demand across Ireland is 56,200 units per annum. Annual average housing demand in the west region is 5,030 units per annum out to 2036, with a significant proportion of this required in Galway. Completions this year for the country as a whole are expected to be slightly above last year's at around 33,500 units, but will still fall well short of the level required to meet demand. Sherry FitzGerald has strong sales in new developments at Garraí na Sailí, Rahoon and Ard Raithní, Barna for Burkeway Homes, Cnocán na Craoibhe on Clybaun Road for Red Fox Residential, Garrán Choill Darach, Oranmore for BRTW Developments LTD and Cnoc an Chaisleáin, Oranmore for Kingscroft Developments.
Supply shortages are evident not just in the new home market. There were just 841 second-hand homes available for sale in Galway city and county in July 2024. This represents a mere 0.7 per cent of the county’s housing stock. Comparing this to five years ago, advertised stock for sale has fallen significantly by 16 per cent across the county.
Turning to transaction activity, approximately 827 residential transactions1 were made by household buyers in Galway, as per stamp duty returns, in the first six months of 2025. This is a 9.6 per cent decline on the same period in 2024, which is unsurprising given the shortage of stock on the market, both new and second-hand.
An analysis of Sherry FitzGerald’s purchasers and vendors who purchased and sold second-hand homes through Sherry FitzGerald in Galway in 2025, approximately 52 per cent were selling investment properties, whereas just 11 per cent of purchasers were buying investment properties. This disparity between the number of investors entering and exiting the market has persisted for the past decade, leaving the rental market in crisis. Throughout the year, the government has announced policy changes aimed at providing stability to the rental market, including new rental rules that came into force at the start of March 2026. These changes to the rental market aim to provide more certainty and stability for tenants and landlords alike, but it remains to be seen how the market reacts to them. Under Budget 2026, the VAT rate on new build apartments has been reduced to nine per cent, aiming to improve the viability of apartment development and help increase supply. When examining the profile of buyers during this period, owner-occupiers remained the largest cohort, accounting for 61 per cent of the total.
The housing market continues to grapple with significant challenges as we move forward into 2026. There has, however, been a clear focus from the government this year on tackling the housing crisis. Both Budget 2026 and the recently announced housing plan demonstrate an ambitious effort to expand on previously announced changes for the residential market. With the government’s plans now outlined, it is important that the focus turns to delivering these much-needed homes in Galway and across the rest of the country.
Predications for 2026. On the Macro geo-political front, the world is in an uncertain place, now with the war in the Middle East between Iran, the US and Israel, more uncertainty has been introduced. This war is already having severe upward pressure on oil and gas prices and on supply chains, and will likely push inflation up and could have a knock-on effect on higher interest rates. Businesses, property and markets in general do not like uncertainty. However, in the context of the Irish housing market, the supply of new homes remains very limited, our economy is performing very well, and demand for housing is strong; as a result, it's likely prices will continue to rise in 2026.
Sherry FitzGerald office in Galway is located on Forster Street, with a further network 113 offices nationwide in Ireland, we provide services in sales, rentals, management, property finance and valuations and can be contacted at www.sherryfitz.ie or 091 569 123.
