House price inflation rose at an annualised rate of 7.6 per cent in September as ongoing supply shortages continued to fuel demand.

Property price inflation has hovered between 7 and 8 per cent for most of the year, down from the double-digit price growth seen last year.

However, the headline rate is still ahead of average wage growth, meaning the purchasing power of buyers continues to be eroded.

The latest residential property price index, compiled by the Central Statistics Office (CSO), indicated that house prices in Dublin rose by 5.3 per cent in the 12 months to the end of September, down from almost 11 per cent in September last year.

House price inflation outside the capital was 9.4 per cent in September, marginally down on the 9.3 per cent recorded in September 2024.

The median (or middle value) price of a dwelling purchased nationally in the 12 months to September was €380,000.

Dún Laoghaire-Rathdown had the highest median price – €675,000 – while the lowest median price was €190,000 in Donegal.

The CSO’s monthly barometer of prices comes in the wake of the Government’s latest housing activation plan, published last week, which promises to lift supply by 300,000 units between now and the end of 2030, a tall order given the recent slowdown in homebuilding.

The plan promises 90,000 starter homes over five years.

The CSO’s index notes prices of new dwellings in the third quarter were 5.5 per cent higher than in the corresponding quarter of 2024. This compared with an annualised increase of 4.3 per cent in the previous quarter.

Prices of existing dwellings in the third quarter of 2025 were 8.1 per cent higher than in the corresponding quarter of 2024, down from an annualised increase of 8.8 per cent in the year to the second quarter.

“The uptick in the rate of house price growth will only add to the concern of aspiring buyers as it means houses are becoming even more unaffordable for them,” Trevor Grant, chairman of Irish Mortgage Advisors, said.

“With just over a month now to go until the end of the year, many prospective buyers will be begrudgingly accepting that 2025 has become yet another year that they’ll been unable to realise their dreams of home ownership,” he said.