House prices to rise by 7% in 2005, says lender

HOUSE price inflation will be higher than expected this year with revised housing inflation forecast at 7%.

IIB Homeloans has revised its house price forecast up from 5% to 7% in 2005 and has seen a surge in home loan demand at a time when consumer sentiment has been lacklustre elsewhere in the economy.

Property values rose by €30 billion last year after the level of borrowing is deducted.