The threat of a trade war will influence how the housing market will perform this year, according to a new report by property website MyHome.ie, in association with Bank of Ireland.
The report says the Irish property market has a “disproportionate reliance” on high income earners working in multinational sector, which leaves it vulnerable to any sudden shock.
It found that asking prices for property rose by 8% over the year.
The average mortgage loan for a house purchase is now almost €320,000, up 7% on the year, according to the report.
It added in the absence of the impact of a trade war, the housing market’s record low supply levels and continued strong demand meant that MyHome’s forecast for 5% inflation this year might be “too conservative”.
Bank of Ireland chief economist Conall MacCoille, who authored the report, warned of increasingly stretched affordability in the market.
“Through 2024 Ireland’s residential property price index rose by 8.7%, stretching affordability versus the 5.6% pay growth recorded over the same period,” he said.
“The average Irish residential property transaction of €404,000 was an eight-times multiple of average annual earnings of €51,000,” he stated.
“This is the most stretched Irish house prices have become relative to income since 2009,” he added.
Article Source – Trade war threat to impact housing market this year – report – RTE
