AIB has launched a €350 million fund to support the construction of new homes in Dublin, Cork and Galway.

The bank said its New Homes Development Fund would help address the shortage of residential housing in urban areas and would be available to borrowers who could “demonstrate prior experience in residential development”.

The bank said it was accepting applications from today, with specialist teams now in place in the three counties.

Estate agency and property consultancy firm Savills has welcomed the launch of the fund, saying its launch was “timely” as pent up demand began to push property prices higher.