House prices outpacing incomes in some EU countries

Updated / Tuesday, 10 Nov 2026 14:15

The price of homes in relation to incomes across the EU are on average 6.8% higher now than they were in 2015, a study by Eurostat has found.

The research into housing affordability shows the rate of change in the house price-to-income ratio over the last decade various considerably by country.

It shows that between 2015 and 2025 Portugal recorded the largest increase of 60.8%, followed by the Netherlands (34.3%), Hungary (26.5%), Czechia (25.8%), and Spain (24.5%).

Ireland is eighth on the list, with an increase of about 13%.

At the other end of the scale, Romania saw the largest drop of 42.8%, followed by Finland with a decrease of 25.2% and Bulgaria, with a fall of 16.2%.

The Eurostat publication from 9 November also notes "another way to understand housing affordability is the standardised house price-to-income ratio - it shows whether the ratio of the house price index to the household income is above or below its long-term average since 2000".

The EU statistical agency says that according to the standardised house price-to-income ratio there were two "clear peaks" - one in 2007 ahead of the global financial crisis, and another in 2022.

In these years, the house price-to-income ratio was 7.9% and 7.4% above its long-term average.

The research found that "between these peaks, the ratio decreased to 6.4% below its long-term average in 2014, before rising again".

It also said "after 2022, it fell in 2023 and 2024, then edged back above its long-term average in 2025 (+0.03%)."

Commenting on the latter set of Eurostat figures, Dermot O'Leary, the chief economist with Goodbody, said Ireland "sits in the middle, with the ratio standing 2% below its long-term average.

"One could argue that the average includes a period of overvaluation in the mid-2000s, but it equally includes the early-2010s when prices were significantly depressed," he said.

Mr O'Leary added that Goodbody research suggests the price of new homes here had risen by an average of 6% over the past ten years.

"While substantial, other European countries had also seen greater increases, with the rise in construction costs at the start of this decade being a major factor," he said,

"As the affordability analysis shows, this needs to be balanced against the strong rise in incomes that have been experienced in Ireland," the economist stated.

"In the context of new homes, a key point is that the cost of construction has decoupled from income growth over recent years, with implications for access to the market for certain income cohorts. As we have noted previously, policy efforts need to ensure that this gap is closed, either by subsidy or reducing the costs of building," he added.