The Potential Negative Impact of President Donald Trump’s New Term on the Irish Economy and Property Market

As President Donald Trump begins his second term in 2025, one of his administration's cornerstone policies - a proposed 15% corporate tax rate for U.S. companies - has sparked global discussions, including in Ireland. For decades, Ireland's low corporate tax rate and business-friendly policies have attracted multinational giants in the tech and pharmaceutical industries, making it a hub for foreign direct investment (FDI).

While Trump’s tax reforms could incentivise U.S. companies to repatriate some operations, Ireland remains well-positioned to adapt, leveraging its strengths and exploring new opportunities for economic growth and investment.

Why Ireland Remains Competitive Ireland’s economic success has been significantly bolstered by FDI, with major U.S.-based companies like Google, Apple, and Pfizer establishing European headquarters and operations. These firms have thrived in Ireland due to:

• A competitive corporate tax rate (12.5%).

• Access to the European Union’s single market.

• A highly skilled, English-speaking workforce.

• A stable regulatory and business environment.

Even if Trump’s proposed 15% corporate tax rate is implemented, Ireland's appeal extends beyond taxation. The country offers strategic advantages that will continue to attract global businesses, including access to the EU, strong intellectual property protections, and an innovation-friendly ecosystem.

Impact on the Irish Economy: While a potential decline in US led FDI is a concern, Ireland has historically demonstrated economic adaptability. Several factors will play a role in mitigating risks:

Broadening Investment Sources: Ireland has already diversified its investment sources, attracting companies from Europe, Asia, and beyond. As non-U.S. companies increase their presence, Ireland can further strengthen ties with global markets, reinforcing its economic resilience.

Strengthening Domestic and EU Partnerships: Ireland’s participation in the EU single market remains a powerful draw for businesses seeking seamless trade access. Continued investment in infrastructure, technology, and education will enhance its position as a leading European business hub.

A Skilled and Adaptive Workforce: Ireland’s workforce is one of its strongest assets. Ongoing investments in education, particularly in tech, finance, and renewable energy, will ensure that the country remains an attractive destination for businesses requiring highly skilled talent.

Impact on Ireland’s Property Market

While the property market is closely tied to economic performance, Ireland’s housing dynamics present a mixed picture, with both challenges and opportunities:

Sustained Demand for Residential Housing: Ireland is experiencing a housing shortage, particularly in major cities like Dublin, Cork, and Limerick. Even if some multinational firms reduce operations, the demand for housing remains strong due to population growth, an expanding domestic workforce, and ongoing urbanisation. This could temper any potential slowdown in property price growth.

Balanced Commercial Real Estate Outlook While a reduction in new multinational offices could slow demand for commercial space, the shift toward remote and hybrid work models is already reshaping the market. Ireland's focus on innovation hubs, co-working spaces, and emerging industries could help maintain steady demand for office and industrial properties.

Opportunities in New Sectors As Ireland diversifies its economy, investment in renewable energy, life sciences, fintech, and logistics is likely to increase. This shift will create new opportunities in the property sector, including sustainable developments and specialised business hubs.

Outlook for property investors, Ireland remains a promising market despite global uncertainties. Underpinned by the Significant Housing Shortage

Recent analyses indicate that Ireland needs to construct between 50,000 and 93,000 new homes annually to address the housing shortage and align with European housing standards. The Central Bank of Ireland estimates that 52,000 homes per year are required until 2050 to compensate for a decade of undersupply. Davy Stockbrokers suggests that building 93,000 homes annually until 2031 would bring Ireland closer to the European average of housing per capita. (roundtowercapital.ie). However, in 2024, only about 33,000 homes were completed, highlighting a significant gap between current construction rates and the identified need. (reuters.com). This shortfall has contributed to rising property prices and rents, as demand continues to outpace supply.

Addressing this issue requires not only increasing the number of homes built annually but also implementing policy changes to streamline planning processes, enhance construction productivity, and ensure the availability of zoned and serviced land.

In conclusion, President Donald Trump’s proposed 15% corporate tax rate presents both challenges and opportunities for Ireland. While there is potential for some US multinationals to adjust their operations, Ireland’s economic resilience, strong workforce, and access to the EU will continue to make it an attractive destination for investment. For property investors, the country’s ongoing housing shortage and economic diversification efforts offer reasons for optimism. By staying agile and forward-thinking, Ireland is well-positioned to navigate global economic shifts and maintain its standing as a vibrant, investment-friendly economy.