Budget 2025 marks a meaningful shift for Ireland’s apartment and build-to-rent (BTR) market. For years, high costs and weak margins have made large-scale delivery difficult. This budget doesn’t solve everything — but it does tilt the economics back toward viability

VAT and Viability

From October 2025, the VAT rate on the sale of completed apartments drops from 13.5% to 9% until 2030. While it doesn’t reduce build costs, it improves the margin on completed units and strengthens exit values particularly useful in mixed-tenure or forward-sale structures.

Enhanced Deductions and Cost Rental Incentives

Developers can now claim 125% of qualifying construction costs (up to €50,000 extra per unit) roughly €6,000 in post-tax benefit per apartment. Across scale, that’s meaningful. Timing matters thoughn, only projects commencing between late 2025 and 2030 qualify.

In parallel, cost-rental income is being made exempt from corporation tax, a game changer for institutional investors seeking long term, stable yields. It brings cost rental projects closer to commercial viability without heavy subsidy.

Land, Timelines and Delivery Pressure

The Stamp Duty Refund Scheme has been extended to 2030 with longer timeframes, helping larger or phased schemes manage cash flow. At the same time, the Residential Zoned Land Tax and forthcoming Derelict Property Tax make holding land without developing it more expensive encouraging activation and reducing land banking.

Investor Takeaways

For developers and investors, the picture is clear:

• Margins are improving, especially for mixed-tenure models.

• Tax efficiency is stronger, particularly under cost rental.

• Delivery incentives and land pressures favour active developers over passive holders.

Budget 2025 won’t erase inflation or planning delays, but it sends a strong signal: policy is now firmly pro-delivery.For those ready to act, the next 12 months are about positioning securing sites, optimising structures, and locking in eligibility for the new incentives before the window closes.

At Grove & Co, we deliver award-winning expertise in interior architecture, space planning, design, FF&E, and turnkey project installation. Our role is to help developers and investors optimise their schemes maximising occupancy, strengthening asset performance, and ensuring projects stand out in a competitive market.

If you’re planning a development and want to explore how our experience can add value, let’s connect and discuss insights from our portfolio of award winning schemes.