Pre-crash European banks were pumping money into the Irish banking system, who ended up with more money than they could hand out. Lending standards plummeted, and 100% mortgages with top up loans were the norm. Developers were also being handed money like crazy, leading to housing estates being thrown up everywhere, whether they were needed or not.

Then the banks stopped lending due to the 2008 crash. First thing that happened was the developers went bust, leaving half-finished office blocks and housing estates everywhere. These became decayed over the subsequent years, some were eventually completed, some were demolished, some remain. Then the government bailed out the banks, taking majority ownership of all the major banks and borrowed heavily to fund it. At the same time, their tax income (which was propped up by stamp duty from property sales) collapsed, and heavy austerity was implemented, further pinching the economy. Because of the dire state of the country's finances, it became unviable to source affordable borrowing, so the state had to enter an EU-IMF-ECB bailout, subject to humiliating oversight and regular check up visits to ensure "good behaviour".

They also bought up all the bankrupted assets of the defunct developers from the defunct banks and consolidated them under a state controlled agency, NAMA. They acquired the assets at an average 50% discount, and finally turned a profit selling them off last year.

Meanwhile, builders started emigrating (mainly to Australia) and all the major developers were defunct, so when things recovered and pent up demand for housing could be accommodated with mortgage credit, there was nobody left to build, so within 5 years, housing costs had skyrocketed, where they remain today.