People who hope to get their foot on the housing ladder are losing hope as house prices remain stuck at unaffordable levels, and the cost of living impacts the ability to rent or buy homes.
The cost-of-living crisis is severely hampering potential homeowners' ability to buy amid fears property prices will not see a drop in the near future, according to new research.
Rising inflation - which has seen necessary expenses such as fuel, electricity and groceries soar in recent months - is also leaving prospective renters unable to afford a home.
But the situation is not dampening buyers' demand, the survey found.
Mortgage experts have warned that a levelling out of property prices is the best-case scenario for those seeking homes, as demand continues to outweigh supply.
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Almost two-thirds of people - 63% - looking to rent say the cost of living is affecting their ability to rent a property, according to a MyHome.ie survey released today.
And just under half - 49% - of those looking to buy say inflation is stalling their ability to purchase as price rises eat into their disposable income.
The difficulty to secure a property is forcing both renters and buyers to abandon their preferred location, according to the survey of 2,861 people.
More than 60% of prospective homebuyers and three-quarters of renters have had to look beyond their top property location due to spiralling home prices.
Yet, property website MyHome.ie boss Joanne Geary said rising inflation has not yet had an impact on demand.
"The rise in the cost of living is having a significantly negative impact on consumer sentiment, yet we know that demand is still very robust despite these financial pressures," she said.
"On MyHome.ie in July, we saw a surge in brochure views up by over 40% on the previous year - we can see from our metrics that buyer demand is remaining remarkably strong.
"Even though interest rates have recently risen, they are still relatively low and it remains to be seen how much of these increases will be passed on by the banks."
She said: "Given employment levels are at an all-time high, the demand dynamic in the market remains very buoyant in spite of cost-of-living increases."
Housing campaigner David Hall, of the Irish Mortgage Holders Organisation, said while the cost of living may help property prices level off, he does not foresee "any big drops".
He also said he fears builders will leave the market due to unpredictable sale prices, straining supply further.
"I think there's another issue there. Will builders continue to build homes now? Will that slow down? If that slows down and the demand stays the same, the supply dwindles and that might protect property prices," he said.
"If you're building a house now, it takes 12 months, you don't know what the value will be in 12 months' time. There's a significant amount of uncertainty. If I were building a house at the moment, I don't know how comfortable I would be that the price will be the same in a few years' time. And I'm funding this now, I'm paying for it."
The survey also found that 85% of respondents believe the Government could do more to help the property sector, while 45% said the rising cost of living had affected their ability to renovate or do other building works in their homes.
Two-thirds of respondents have finances in place to buy a property in the next year, but just over half say they are confident in their ability to buy in that timeframe.
Ms Geary added that overwhelmingly negative sentiment around renting was having an effect across the entire market.
"Renters are under huge pressure and, anecdotally, we know that many of those who are in a position to leave the rental market and buy are pressing ahead sooner than they otherwise would have, given the lack of value, uncertainty and choice in the rental market at present. In many cases, it simply could be cheaper to buy than rent if the stock was available to buy."
A spokesman for the Department of Housing said the Government's Housing for All plan reflects the priority of creating a long-term sustainable housing system by boosting housing supply to 2030, increasing access to affordable housing and moderating house price inflation.
He added that guaranteed State investment of more than €4 billion a year in housing is aimed at increasing supply which, in turn, will help increase access to affordable housing to buy or rent, and the Government is also increasing supports for homeownership.
First-time buyers are now drawing down bigger mortgages than they were at the peak of the Celtic Tiger years.
The Banking and Payments Federation recently revealed the average first-time buyer mortgage drawdown has hit €263,312.
This is the highest level since it started collecting data during the Celtic Tiger boom in 2003.
The previous record was set in early 2008 at €251,831, just months before the property bubble burst and contributed to the banking crisis that plunged the country into recession.
This sparked fears that property prices will soon outstrip even those seen at the Celtic Tiger peak.
The latest Daft.ie rental report showed average rents have increased nationally by €181 to €1,618 a month, which is an extra €2,172 a year. The report also found that, at the beginning of the month, there were just 716 homes available to rent across the Republic, with fewer than 300 in Dublin.
That compares to 2,500 a year earlier, marking another record low in availability.
Demands were made recently for the Government to take an emergency response towards a lack of housing supply, as the number of people in emergency accommodation reaches a record high.
