Nama ‘should intervene’ to stop new bubble

Nama should intervene to ensure that a house price bubble does not form in the Dublin market, said chief economist with Goodbody Stockbrokers, Dermot O’Leary.

After one of the steepest house price crashes among OECD countries, a new property cycle is emerging as the domestic economy recovers. He cites international comparisons which show that in a crash of this magnitude, house prices decline for six years and then grow by on average 6% each year.

“A similar occurrence in Ireland would mean that 40% of the drop in prices would be recovered within five years, leaving prices still down 30% from the peak,” said Mr O’Leary in a new study on the property market