The Daft.ie report stated that the first six months of 2017 in Ireland the house prices has risen more than all of last year. They will continue to rise for the next five to ten years unless signification measures are taken.
The house prices are moving up 12 percent higher than a year ago with an average of €2,000 a month. This leaves Dublin on the forefront of the housing increase.
Housing prices increasing means more people wanting to sell their home with more than 6,000 homes listed for May. That has been the highest total since middle of 2008. However, this increase of property for sale is not even close to meeting the demand of the market.
With the government reviewing the Help-to-Buy scheme, fear comes as this may lead to another surge of people wanting to buy.
A Daft.ie economist Ronan Lyons warns the rates in Dublin are going to increase faster than any other part of Ireland. He said this was because, “we’ve regulated ourselves out of the volume of homes that are needed”.
The possible cause for this? The government is being critisied for not catering to high volume housing. If a developer wants to build a huge apartment building, they have to go through too many regulations and massive amounts of VAT tax.
A solution? The Construction Industry Federation has lobbied for incentives and VAT cuts in order to make large scale housing financially attractive.
Mr.Donohoe, Minister of Finance, says he will compare industry costs to Europe and Ireland after rejecting this argument.
Overall, the housing prices seem they will continue to rise with momentum unless the government takes immediate action. An action the government can take is to cut the high cost of construction high scale housing units. The market is being closely watched to ensure another housing bubble does not form. If one does mortgages will be even harder to find and it will cause a huge financial stress to Ireland.
In reference to House prices to rise for up to 10 years – property report by Charlie Weston in Independent.ie and House prices to rise for up to 10 years, property report says by Fiach Kelly in Irish Times.