Irish consumer spending is set to reach a record €105bn this year, surpassing the boomtime peak set in 2007, according to a new report.

The Home Renovation Incentive (HRI), a tax relief for home improvements, is fuelling strong growth in people’s spending on their homes, according to the latest Consumer Market Monitor from the Marketing Institute of Ireland and UCD Michael Smurfit Graduate Business School.

Sales of hardware, furnishings and electrical goods have surged by 14pc this year, making that the highest- growth sector in retailing.

The report’s author, Prof Mary Lambkin, said: “In a market where houses for those trading-up or downsizing are in short supply, the HRI tax incentive scheme has been a major factor driving the trend for home transformation, stimulating a lot of spending on household goods and enhancements, as well as being a considerable support for the building trades and related retail sectors.

“12,179 building contractors have been involved in these projects and, given a multiplier of 2-3 for the number of trades contributing to these projects, that may have supported as many as 30,000 jobs,” she added.

The report said the fall in the value of sterling had boosted buying power for UK-made goods. It aggregates data from the Central Statistics Office (CSO), the Central Bank of Ireland, the European Commission, and a number of other sources.

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