Budget 2027: Insights from CBRE

1. A Cost of Living Budget
The Budget 2027 package totals €8.65 billion, comprising €7 billion of spending measures and €1.65 billion of tax measures. Capital spending will reach €20.3 billion, including €5.6 billion for housing, of which €3 billion is allocated to social housing. A range of capital investments for infrastructure was also confirmed, much of which had already been outlined under the National Development Plan, alongside additional funding for key projects such as Metrolink. But largely the property tax changes are small and mostly aimed at households, with the Derelict Property Tax the main exception.

2. Derelict Property Tax a Potential Boost for Towns and Cities
The Government will introduce a new 7% tax on residential and non-residential properties that local authorities identify as derelict. Derelict being defined as a property that is unused and unsuitable for use as a dwelling, business premises or community facility, including because of significant structural deterioration.

The value is self-assessed on market value and owners can avoid liability by remediating the property, demolishing and clearing it, or selling to a purchaser who will address the dereliction. The proposed rollout is phased. It starts in 2027 with towns and cities of 4,000 or more people, then extends in 2028 to towns of 2,000 or more.

CBRE View: This is a positive step in our view. Dereliction has become an increasing problem in cities and towns across the country. This tax could act as a small catalyst for the refurbishment or sale of more older, obsolete buildings in city centres.

At 7% of market value, a derelict building worth €1 million would give rise to an annual tax liability of €70,000. With no income stream to offset that cost, the measure is likely to be material for some owners. According to a report earlier this year, DCC's derelict site register already lists 138 properties, about half of them in Dublin 1, 2, 7 and 8, with another 850 buildings are under active investigation for possible inclusion. If the objective is to regenerate our cities, this is a step in the right direction.

3. Help to Buy, Renters Credit and Rent-a-Room Relief
Help to Buy rises by €5,000 to a maximum refund of €35,000 from today, with all other conditions unchanged. The rent tax credit rises by €150 to €1,150 for an individual and €2,300 for a jointly assessed couple for the 2027 and 2028 tax years. Rent-a-room relief increases from €14,000 to €16,000 from January 1, 2027. The stamp duty reduction for first-time buyers sought by some coalition TDs did not materialise.

CBRE View: These measures will be welcomed by first-time buyers, renters and small landlords. However, the increases largely offset a portion of the house price and rental inflation seen in recent years rather than materially improving affordability. Useful as they are, they remain demand-side supports and only scratch the surface of a housing challenge fundamentally driven by inadequate supply.

4. More RZLT Exemptions
The Finance Bill is expected to provide additional scope for owners of land included on the 2027 Residential Zoned Land Tax map to seek a change in zoning and, in specified circumstances, an exemption. The measure is expected to be similar to the limited rezoning provision introduced by Finance Act 2025.

CBRE View: We have undoubtedly seen the RZLT encourage more land transactions and, in our view, it is a tax that is having the desired effect. That said, it can produce challenging outcomes where landowners or developers are actively seeking to progress development but are delayed by factors outside their control. On balance, additional exemption mechanisms are sensible, although the ultimate impact will depend on the detail.

While RZLT has helped bring greater focus to unlocking development land, the most significant measure for unlocking housing supply remains the Section 28 planning guidelines. In our view, these guidelines are likely to have a far greater impact on housing delivery than any individual measure announced in the Budget.

5. CGT on Development Land to Remain at 33%
The standard CGT rate will be reduced from 33% to 31% for disposals from October 7th 2026. However, development land disposals are excluded and CGT will remain at 33%.

CBRE View: Retaining the 33% CGT rate on development land suggests the Government wishes to avoid creating additional incentives for land trading and speculation. While some in the industry will argue that a lower rate could have improved land market liquidity, the Government may take the view that RZLT already provides a strong incentive for landowners to bring sites forward for development. This is likely to be one of the more debated property-related measures in the Finance Bill.