Moderating Inflation Brings Stability to Ireland’s Building Sector
The Society of Chartered Surveyors Ireland (SCSI) released its latest Tender Price Index (TPI), tracking commercial projects over €1 million. Nationally, prices rose 1.5% in the first half of 2025, then eased to 1% in the second half. This total 2.5% yearly gain marks the lowest since 2020, down from 3% in 2024. Moderating inflation aids stability after years of disruption from Covid and global conflicts.
Regional variations shaped the landscape. Connacht and Ulster saw the steepest median increase at 1.8% in late 2025, with an annual 3.8% jump. Munster recorded 1.5% for the half and 3.5% yearly. Dublin and Leinster showed no inflation in the second half, though Dublin hit 1% annually and Leinster excluding Dublin reached 0.5%. These trends influence planning permission timelines, as local costs affect project bids.
Labour shortages and rising wages drove most pressure, despite easing material costs. Two-thirds of surveyed quantity surveyors noted tender hikes in early 2025. Nearly 60% view material prices at mid-upswing or peak, with 20% sensing an early downturn. SCSI Vice President Tomás Kelly highlighted price stability as a return to normalcy, boosting sector confidence.
Looking ahead, 69% of respondents expect tender prices to rise in early 2026, 25% foresee stability, and 6% predict drops. This outlook ties into broader challenges like An Bord Pleanála decision delays and flood-risk development scrutiny. Developers must factor inflation into housing scheme approval applications, where material contravention risks or environmental impact assessments can amplify costs.
For Ireland’s construction sector, stable pricing opens doors for stalled projects. Infrastructure and commercial builds gain from predictable bids, but persistent skills gaps demand action. Public investment supports growth, yet pipeline visibility beyond 2026 weakens. Quantity surveyors urge early planning permission pursuits to lock in current rates before potential upticks.
- National 2025 tender rise: 2.5% total (1.5% H1, 1% H2).
- Top regional annual gains: Connacht/Ulster 3.8%, Munster 3.5%.
- Key drivers: Labour costs, shortages; materials stabilising.
- 2026 forecast: Most expect modest increases.
- Implications: Better timing for housing scheme approval and infrastructure.
Stable tenders ease pressures on environmental impact reviews and large-scale bids. Developers eyeing commercial or residential ventures should consult SCSI data for budgeting. With output projected to grow 4% in 2026, proactive planning permission strategies secure competitive edges amid forecasts of 3% inflation.
Other reports align: Turner & Townsend pegs 2025 at 2.9%, dipping to 2.2% next year. AECOM echoes 3% rises, stressing readiness for housing and infrastructure. These signals prompt urgency in navigating material contravention hurdles or An Bord Pleanála decision appeals. Cost moderation creates windows for flood-risk development and urban expansions.
Surveyors report strong workloads at 81% capacity, with competitive bidding narrowing margins. Contractors prioritise volume over profits, focusing on public schemes. Easing geopolitical risks and supply chains foster optimism, though labour demands persist. For planners, this environment favours swift planning permission lodgements to capitalise on lows.
Originally reported in RTE.ie on Tue, 17 Feb 2026 10:25:17 +0000. Full story
