House prices still have plenty of room to fall

House prices in Ireland are still economically outrageous.

The average wage in Ireland was €36,000 for the year 2012. In the years before the Celtic Tiger, the maximum mortgage that a building society would lend never exceeded 2½ times a family’s income.

Based on that prudent principle, the most that an average household with two incomes can afford to pay for a house nowadays would be €180,000. The last time an average house cost that sum was back in 2001.