Lending restrictions causing property price rises to ease off
Published 25/06/2015 | 02:30
Lending restrictions put in place by the Central Bank are causing property price rises to ease off.
And the rules will keep price increases muted for the remainder of the year, experts said.
They were reacting to the latest property price index from the Central Statistics Office that shows prices rose nationwide last month.
However, they fell in Dublin, and economist with Investec Bank Philip O'Sullivan said this was a surprise given the chronic shortage of homes for sale.
An easing-off in property price rises is good for buyers. But it is bad news for existing homeowners, many of whom are still in negative equity - where the size of their mortgage is greater than their property's value.
Prices were up 0.5pc across the country in May, and are now up 13.8pc in the past year. There was a fall of 0.1pc in Dublin in May. However, prices are up 15.2pc when compared with the same month last year.
Outside the capital, prices rose by 1.1pc in May, and are up almost 12pc in a year, said the CSO. However, the statistics only capture properties where a mortgage has been issued, with cash purchases excluded.