HOUSE price rises are set to continue for the foreseeable future as rural areas significantly outstrip urban with some seeing an almost 14pc increase.
The trend of working from home and a scarcity of properties to buy is driving a boom in prices in Border and midland counties.
Experts said people were swapping their urban homes in places like Dublin for larger homes in more rural areas where prices are much lower, as they want to work from home.
A chronic shortage of properties to buy sent prices across the State up by almost 7pc in June, the fastest rate of property price rises in almost three years. Prices have risen now for 10 months in a row.
Prices in Dublin rose by 6.4pc in the past year. Meanwhile, prices in the Border region shot up by almost 14pc in the year to June.
Austin Hughes, economist at KBC Bank, said: “We have a combination of exceptionally strong demand, combined with curtailed supply, making for a perfect storm in the housing market.”
Meanwhile, the Institute of Professional Auctioneers and Valuers (IPAV) said the rising prices of recent months are likely to continue for the foreseeable future until supply improves.
Pat Davitt, IPAV chief executive, said: “Unfortunately the divergence between supply and demand is enormous and is unlikely to change in any meaningful way in the near future.”
He said supply is so tight that in some cases would-be sellers are not putting their homes on the market in case they may not be able to find a suitable property to buy or that by the time they do, “prices may have moved beyond their budgets”.
The newly released figures from the Central Statistics Office (CSO) reveal how property prices have surged again, making it more difficult for people to realise the dream of owning their own home.
They were up 6.9pc in the year to June. The is the fastest pace of rise in two-and-a-half years. It is the tenth month in a row of price acceleration in the housing market.
In Dublin, prices rose by 6.4pc. Prices outside Dublin were 7.4pc higher. A chronic shortage of both new and second-hand homes to buy is causing prices to spiral.
Housing experts expect around 20,000 new homes will be completed this year, after months of stalled building due to the lockdown.
But the Government reckons we need up to 35,000 new units to satisfy demand.
It comes after data for May found prices rose by 5.5pc. The region outside Dublin that saw the largest rise in house prices was the Border, at 13.9pc.
At the other end of the scale, the southwest saw a 2.7pc rise.
Households paid a median price of €265,000 for a home in the year to June, the CSO said. The Dublin region had the highest median price at €395,000. Within the Dublin region, Dún Laoghaire-Rathdown had the highest median price at €555,000, while Fingal had the lowest at €360,000.
The highest median prices outside Dublin were in Wicklow at €365,000 and Kildare at €329,950. Leitrim and Longford had the lowest prices at €120,000.
The CSO said the number of property transactions in June rose by 8.3pc to 3,473. The total value of transactions filed with Revenue was €1.1bn.
Brokers Ireland said the market needs a far greater level of supply of new homes and at affordable prices.
Meanwhile, the average age for people to leave the parental home in this country is now 27.4 years old.