Irish household wealth has more than doubled over the past decade, however much of this increase has been driven by a rise in the value of people’s homes, new data by Davy Insights has found.
According to Davy’s Wealth in Ireland report, the period from 2014 to 2024 shows a rise in net household wealth from €573 billion to €1.32 trillion, with this figure projected to approach €2.6 trillion by 2035.
‘While this represents a remarkable recovery since the global financial crisis, it must be cautioned that much of the increase reflects inflation in the value of people’s homes, rather than the accumulation of a diversified and transactable wealth,’ Davy noted.
Non-housing wealth
Aside from house prices, the rate of accumulation of non-housing wealth in Ireland has lagged the performance of the overall economy, despite being ‘strong in absolute and relative terms’, Davy noted.
This divergence reflects an under-management of financial resources by Irish households, including a shortfall in pension provision, and ‘sluggish growth’ in the reported value of Irish-owned businesses, both in a domestic and eurozone context.
On pension participation in particular, Irish private sector workers were estimated to face a pension deficit of €250 billion as of 2024, a figure below levels associated with sufficient retirement support. Ireland is also ‘not exploiting the opportunity offered by pensions for tax-efficient investing’, it said.
Wealthy households
As Davy noted, approximately 75,000 households in Ireland would be considered ‘wealthy’, out of a total of 1.9 million, with most households focused on housing security, short-term reserves, and pension planning aligned with their working life stage.
Looking to the future, meanwhile, Davy noted that the ‘outlook for Irish wealth is very positive with structural momentum. The number of older households is growing in absolute and relative terms, house supply is expanding and the income basis for house prices is solid.
‘There is significant upside potential here if the constraints to the conversion of household employment and enterprise into wealth can be comprehensively addressed.’ Read more here.
