House prices tipped to rise by a national average of 6pc
Published 12/04/2014 | 02:30
HOUSE prices will continue to rise strongly in 2014 both in the capital and outside it, according to a new economic report.
Property prices will rise by 10pc in Dublin in the coming months and by 6pc outside the capital, economist Alan McQuaid of Merrion Stockbrokers has predicted.
He said there was evidence of a pick-up in mortgage lending by banks but the overall amount being advanced for house and apartment purchases had yet to return to normal.
"Overall, we see an average rise in Irish house prices of around 6pc in 2014, with Dublin posting the biggest increase, of 10pc plus," Mr McQuaid wrote in a new report on the economy.
He said the housing market could not survive on mainly cash transactions and only limited mortgage draw-downs.
But he said the recent signs of general improvement on the jobs front should boost disposable incomes and help sustain the housing market recovery in the short term, especially in Dublin and the other major cities.
The latest figures from the Central Statistics Office show that property prices increased by 8.1pc in the year to February.
In Dublin, prices were 13.3pc higher in February when compared with the same month last year, pushed up by a chronic shortage of family homes.
However, Finance Minister Michael Noonan wants house prices to rise further and claims fears of another property bubble in Dublin are exaggerated.
Speaking at the 'Sunday Independent' Business Evening this week, Mr Noonan revealed that state property agency NAMA would join forces with developers to build more than 22,000 homes over the next five years.
"I'm worried about the lack of availability of family homes in the greater Dublin area in particular," Mr Noonan said.