House prices will ‘go beyond Celtic Tiger levels’ without dramatic changes in policy, according to a housing expert.
It comes as Tánaiste Leo Varadkar has set a target of building 40,000 new homes a year, warning that home ownership is now ‘out of reach for far too many’.
Mr Varadkar said the target was not Government policy but had been discussed at Cabinet sub-committee level. However, he insisted it was achievable – even if the target for next year is to reach just 25,000.
Dr Rory Hearne, author and lecturer in social policy at Maynooth University, warned that prices will go above the Celtic Tiger peak before they begin to fall.
Dr Hearne said a number of factors are combining to fuel the surge in house prices – including an increase in savings and fall in new builds during the pandemic.
He said investors buying up new properties in recent years is also a ‘significant factor’ alongside Ireland’s ‘insecure and unaffordable’ rental sector which is pressuring people into thinking they have no option but to consider buying.
Meanwhile, a new report has found that the proportion of newly built homes bought by private institutions has risen from 5.6% in 2010 to almost a third in 2019. It marks a sixfold increase in the last decade, the research shows.
The National Social Monitor, by think tank Social Justice Ireland (SJI), has questioned the ability of the State to deliver affordable housing when families are increasingly crowded out of the market by private bodies.
The average price of homes being bought by institutions also rose dramatically in the years between 2016 and 2019, from €229,627 to €304,811. This represents an increase of one third during the lifetime of the Rebuilding Ireland programme, the report says.
Article source – Expert says house prices will ‘go beyond Celtic Tiger levels’ – Extra .ie – James Ward