OECD warning on new house price bubble

The housing market could be heading into another bubble and Government and regulators should be ready to act, the OECD has warned.

The Paris-based think tank said it was worried about the large increases in residential house prices. “The sharp rise in prices and lending raises concerns that another bubble may be forming, and the authorities should stand ready to tighten prudential regulations if needed,” it said in its latest report on Ireland.

The report was published on the same day that CSO figures showed house price inflation had re-accelerated to an annual 10.5% in April. Supply will likely remain restricted for “some time”, warned the OECD.