Trade war may reduce buyer pool in housing market due to reliance on rich multinational workers

Impacts on the status of rich multinational workers could have major implications on the, already low, housing market activity.

12.06am, 8 Apr 2025

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A TRADE WAR could have negative impacts on activity in the housing market due to the potential consequences that tariffs may have on high earners’ jobs in Ireland, a new report has said.

Property website MyHome.ie has said the housing market is reliant on high earners who work for multinational companies in Ireland and – with overall activity already decreasing – the fallout of a US-EU trade war may reduce sales further.

This is because house prices are now eight times the average income and affordability is at its most stretched since 2009.

Any negative impacts to high-paid workers’ jobs, who in a position where current mortgage rates are relatively affordable, may further reduce the low buyer pool.

According to analysis of the Irish property market’s first-quarter performance, MyHome has found that mover drawdowns – which are mortgage loans by existing homeowners seeking to purchase a new home – are now 20% below pre-Covid levels.

This suggests that fewer people are currently looking to sell their existing home or purchase a second property.

Therefore, economic shocks may result in a substantial reduction in activity as MyHome says the market is reliant on first-time buyers having higher-than-average salaries – in some cases, over €90,000 per year.

Chief economist at Bank Of Ireland Conall MacCoille said if a US-EU trade war is to have a negative impact on the employment status of those workers, it could leave the housing market with fewer buyers able to afford higher mortgages.

According to most recent available research from the Central Statistics Office (CSO), 27% of people working in Ireland in 2022 were employed by a foreign-owned multinational company.

Of that group, over a third of them were employed by US-owned firms – whose revenue made up three quarters of all turnover generated by foreign-owned businesses in Ireland that year. 

Even in the absence of a trade war, MacCoille said, asking prices are expected to see a 5% inflation rate this year. Supply is largely driving this inflation, with just one in every 200 homes in Ireland currently listed for sale, he added.

As it stands, government leaders are not expecting foreign tech services based in Ireland, such as US-owned Google, Meta, Apple or Microsoft, to face any tariffs, with Tánaiste and trade minister Simon Harris labelling it the “nuclear option” yesterday.

So far, Ireland’s multinational sector has remained largely untouched as US President Donald Trump’s tariffs have focused on goods, not services – which will not impact multinational firms in Ireland to the same extent as car manufactures, for example.

Record high first-time buyers

There have been countless reports in the last number of months that highlight how the housing market has been propped up by first-time buyers. MyHome today reveals that mortgage drawdowns for the group have hit their highest levels since 2007.

Other reports suggest that first-time buyer activity is so high due to the grants and subsidies that are afforded to the cohort. But some estate agents, experts and politicians believe that those supports are artificially increasing house prices.

In the last 12 months, asking prices for homes have increased by 8.1% nationwide according to today’s report. Excluding Dublin, those listed prices have increased by 9%.

The median price of a home is now €375,000, nationally, and €450,000 in Dublin. At the same time as these increases, there is now a record low number of properties on the market, today’s report says, with a total of 10,800 properties listed on MyHome.