John Fahey: Signs house price inflation is easing but supply will still be challenging

Higher building costs in relation to raw materials and the shortage of workers will hamper a significant increase in new supply

Forward looking supply indicators such as housing starts, measured by commencement notices, were running at 29,343 units on a 12-month cumulative basis to June.

Irish residential property prices were broadly stable over the period 2019 to 2020, but they experienced a sharp uplift last year, especially in the second half of the year, as the growth in new supply stalled while at the same time, there was a surge in household savings.

The latest data from the Central Statistics Office showed prices rising by 0.8% on a monthly basis in May, which followed a 0.4% rise in April.