Tuesday 22 August 2017

How demand for housing is 'a lot stronger than previously thought'

KBC Bank Ireland’s Chief Economist Austin Hughes and Director of Product, Eddie Dillon launch KBC Bank’s new Home Buyer survey (Photo: Shane O'Neill Photography)
KBC Bank Ireland’s Chief Economist Austin Hughes and Director of Product, Eddie Dillon launch KBC Bank’s new Home Buyer survey (Photo: Shane O'Neill Photography)
Charlie Weston

Charlie Weston

Demand for housing is much stronger than previously thought, a new survey indicates.

Pent-up demand for property is now so strong after the market’s collapse that up to a third of people are considering buying a new home.

The survey, commissioned by KBC Bank, found that 32pc of adults are contemplating buying a residential property in the next two years.

KBC Bank economist Austin Hughes accepted that the levels of pent-up demand found in the survey were “exceptionally large”.

This was especially the case as a normal level of transactions would see just 4pc of the housing stock changing hands.

But he said strong demand for housing reflected the fact the housing market here had not functioned for eight years.

“A large part of it is catch-up demand. It is not persistent demand. It is not something we will see for the next 20 years.”

Mr Hughes said the level of demand was much stronger than was commonly assumed.

Asked to put a number on it, he said: “You are probably looking at a couple of hundred thousand coming to the market.

A number of factors were driving people to consider buying – this includes new buyers, movers and those looking at investing in a buy-to-let property.

The stronger economic environment and greater confidence among consumers had meant thousands are considering buying. Jobs were more plentiful, and people needed to move because their personal circumstances had changed, such as having more children.

A nationally-representative sample of 2,000 people were interviewed by Ignite Research last month for the survey.

Mr Hughes said it was surprising that the survey found that almost half of those considering buying in the next two years were single and were looking at buying on their own.

This reflects that fact that more and more people live on their own, he said.

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