Dublin house prices likely to rise 10%

Dublin house prices are set to increase by 10% over the next two years, while prices in the rest of the country will stay in a plus 5% to minus 5% range, according to economist Ronan Lyons.

Mr Lyons compiled the housing market monitor for the fourth quarter of last year on behalf of the Irish Banking Federation (IBF).

The main findings include a 7% increase in the number of properties listed for sale last year compared with 2012; a 10% increase in housing market transactions; and a 6.1% increase in the level of mortgage approvals in 2013 compared with the previous year, although there was a 5% decline in the level of drawdowns.

“While trends in both transactions and the mortgage market are encouraging, the supply side of the market continues to remain a concern. Perhaps the most startling thing to emerge from the report is just how few new homes are being built. Fewer than 1,400 homes were completed in Dublin during 2013, when prices rose at double-digit rates, compared to more than 2,200 during 2010, when prices were falling at double-digit rates,” said Mr Lyons.

Mr Lyons advocated Government intervention in the housing market if the supply of homes in areas where there are shortages continues.