IIB Bank: House prices to fall 5%

Turmoil in world financial markets and nervousness about the Irish economic outlook mean Irish house prices could slip by a further 5% in coming months, according to a forecast by IIB Bank.

The mortgage lender also predicted that the European Central Bank (ECB) would be forced to cut rates by 0.5%, despite the Frankfurt-based bank statement last week that it was reluctant to make cuts.