Building Homes: Apartment construction costs in Europe with a focus on Dublin

The study “Building Homes: Apartment construction costs in Europe with a focus on Dublin” is a collaborative effort between Trinity College Dublin and the Society of Chartered Surveyors Ireland (SCSI), supported by the European Council of Construction Economists. Authors include Ronan Lyons, Gerard O’Sullivan, Bryn Griffiths, Edward McAuley, Adam Bermingham, Tom Gillespie, Maximilian Guennewig‑Moenert and Lea Hauser. Published in July 2024, the report analyses apartment‑building costs across ten European cities, using a “travelling box” methodology that applies a fixed Swiss‑designed apartment specification to each market.

Average construction cost for the surveyed apartment block is €2,057 per m², including taxes, risk and preliminaries. Dublin registers €2,363 /m², making it the second‑most expensive city after Zurich (€2,866 /m²). The cost spread is wide: Tallinn is the cheapest at €1,367 /m², while Zurich is roughly €1,500 /m² higher than the average. Hard costs (site preparation, substructure, structure, non‑structural works, equipment, drainage and ancillary) account for about 75 % of total spend; soft costs (preliminaries, risk, taxes) add the remaining 25 %.

Non‑structural works (ICMS Group 04) contribute the largest share of overall cost at 31.9 %, followed by equipment (Group 05) at just under 20 % and structure (Group 03) at 13.6 %. Soft‑cost categories collectively represent 24.5 % of total expense, with preliminaries alone comprising 48 % of soft costs. Labour‑intensive components such as finishes, services and equipment drive higher prices in Dublin and Zurich, while cities with lower labour rates (e.g., Tallinn, Belfast) show reduced totals.

Hourly construction labour varies markedly across the sample: €16.50 in Estonia, €40.60 in the Netherlands and €39.70 in Sweden. British cities benefit from a zero‑VAT rate on new dwellings, lowering their soft‑cost burden. In Dublin, the VAT rate of 13.5 % adds €103 /m², a significant factor in its cost premium. If Dublin adopted the UK’s zero‑VAT policy, its cost would fall to €2,082 /m², still above the average but reducing the gap with British counterparts.

The report highlights that standardisation and scope reduction can lower construction costs by up to 14 % in Dublin, suggesting opportunities for more affordable, sustainable housing. Recommendations include greater use of modern methods of construction, simplification of façade treatments, and optimisation of non‑structural elements. Reducing soft‑cost components such as risk allowances and preliminaries also offers cost‑saving potential without compromising quality.

When adjusted for inflation to Q3 2022, the report’s Dublin cost aligns with previous SCSI (€2,408‑€2,884 /m²) and DoHLGH (≈€2,803 /m²) findings. However, live project data from Hines show higher realised costs (≈€3,000 /m²), underscoring the influence of project‑specific scope, regulatory requirements and market conditions.

The “travelling box” keeps quantities and specifications constant, isolating price differences across markets. Limitations include the fixed 2011 Swiss design, which may not reflect current local building norms, and the exclusion of land acquisition, finance and developer margins. The study captures the pre‑COVID‑19 cost environment (Q1 2020); subsequent supply‑chain disruptions and inflationary pressures are not reflected.

• Promote standardised apartment designs to achieve economies of scale.
• Encourage modern construction techniques (e.g., prefabrication) to reduce labour intensity.
• Review VAT and other tax regimes to mitigate soft‑cost disparities.
• Support cross‑border research on labour productivity and material sourcing to enhance sustainability. These evidence‑based insights aim to guide policymakers, developers and sustainability advocates in addressing the affordability challenge of European apartment construction while maintaining high environmental and quality standards.