Property and infrastructure - Budget 2027

Rent-a-room relief

Increase in the rent-a-room rental income ceiling from €14,000 to €16,000 from 1 January 2027 and extension of the relief to cover Designated Auxiliary Dwellings installed after 27 July 2026.

Rental tax credit

The rent tax credit is being increased by €150 to €1,150 for an individual and by €300 to €2,300 for a jointly assessed couple. The increased value applies to both the 2027 and 2028 tax years.

Help to Buy scheme

The current level of support available to first time buyers under the Help to Buy scheme is whichever is the lesser of:

• €30,000; or
• 10% of the purchase price of the new property; or
• the amount of Income Tax and DIRT paid in the four years before the application.

The maximum relief available under the Help to Buy scheme is being increased by €5,000, from €30,000 to €35,000. The change takes effect from 7 October 2026. No other changes were announced regarding property values.

Residential Zoned Land Tax

Finance (No. 2) Bill 2026 will provide for a further opportunity for landowners otherwise within the scope of Residential Zoned Land Tax (RZLT) for 2027 to make a submission requesting a change in zoning of land appearing on the revised map for 2027, and, in certain circumstances based around the carrying on of genuine economic activity, being exempted from RZLT for 2027 on foot of such submissions.

Local authority borrowing

In recognition of their role as key stakeholders in the delivery of social and affordable housing, as well as infrastructure and urban regeneration, from 2027, local authorities will be permitted to spend more. They will be allowed to spend out of their own resources or to borrow an additional €200 million annually. This will enable them to invest more in capital projects that are aligned with Government priorities.

Derelict Property Tax

The Derelict Property Tax (DPT) was announced in Budget 2026 as part of the “Delivering Homes, Building Communities to be 2025-2030” housing plan. The tax will be collected by the Revenue Commissioners and will be based on registers of derelict properties that are compiled and maintained by Local Authorities.

DPT will be enacted in Finance (No. 2) Bill 2026. From 2027, Local Authorities will be responsible for identifying derelict properties and recording those properties on a register.  The tax will apply to residential and non-residential properties and the rate of the tax will be 7% of the self-assessed value of the property.

Properties will be identified as derelict if the Local Authority considers it is not in use and is not suitable for use as a dwelling, commercial, social or community facility. In determining whether a building is not suitable for use, a Local Authority will consider factors including but not limited to:

• whether the property is partially or fully boarded up,
• the roof is damaged to the extent it is no longer weatherproof, or
• the property has failing plasterwork or unsecure brickwork.

A preliminary register of derelict properties will be published and property owners will have a right to request a review of their property’s inclusion on this register. Requests for reviews will be managed within the Local Authority sector.

To avoid liability to DPT, owners will be required to take steps to ensure that their property is no longer considered derelict. This can be achieved through redevelopment, the demolition and clearing of any derelict structure or building, or through the sale of the property to an owner who will instead redevelop the property. A limited amount of deferral criteria will apply, such that property owners who remediate properties within a reasonable time frame may seek abatement of the tax.

In its first year of operation, DPT will apply to towns and cities with a population of 4,000 or more, based on Census 2022 data. In the second year of operation, the tax will expand to towns with populations of 2,000 or more. This phased approach supports the regeneration objective while moderating the initial administrative burden on Local Authorities. A total of 107 towns will be in scope in the first year, increasing to 171 in year two.

The key timelines for the first liability year for DPT are as follows:

• 1 January to 31 August 2027: Local Authorities inspect the relevant towns and identify derelict properties.
• 1 September 2027: Preliminary registers of derelict properties are published.
• 1 September 2027 to 30 November 2027: Property owners can seek review of inclusion on register.
• 1 September 2027 to 29 February 2028: Local authorities decide on reviews.
• 1 March 2028: Final registers of derelict properties published and Revenue pay and file window opens.
• 23 June 2028: First pay and file deadline.

There will be a similar cycle annually, with Local Authorities identifying properties between March and August each year and publishing preliminary and final registers in September and March respectively.

Further detail on the operation of the tax will be contained in Finance (No. 2) Bill 2026.

Funding for housing in Budget 2027

In order to address lack of housing supply, €9.4 billion has been allocated for housing in 2027, including:

• €2.2 billion to support social housing needs of 110,000 households through the Housing Assistance, Rental Accommodation and Social Housing Current Expenditure Schemes and investment in emergency supports for those facing homelessness with targeted supports for families experiencing homelessness.
• €3 billion to fund social housing delivery including 11,250 new build social homes.
• €225 million allocated to the Housing Infrastructure Investment Fund.
• Under the Starter Homes Programme, over one billion euro will be allocated to deliver thousands of starter homes through a range of affordability supports, alongside the Help to Buy Initiative.
• Over €360 million is being allocated to address specific housing needs including adaptation grants for homes and the retrofitting of additional social homes.
• €350 million is being allocated to support regeneration of urban areas.
• The Towns and Cities Regeneration Investment Fund will support a programme of investment in every local authority in Ireland. This is linked to the announcement by Minister Harris that from 2027, local authorities will be permitted to spend more, being allowed to spend some of their own resources, or borrow, an additional €200 million per annum, in order to invest more in capital projects that are consistent with Government priorities.