House prices will continue to rise “for the next five, six, seven years” before new supply comes anywhere near to meeting pent-up demand.
That is the view of the Economic and Social Research Institute in its latest quarterly report.
ESRI research professor, Kieran McQuinn, said that although mortgage credit is growing rapidly, there was no evidence of a bubble in the housing price market. House prices could, however, continue to rise “for the next five, six, seven years”, Mr McQuinn said, as lack of supply drives the market.
The ESRI also said there is a potential threat to indebted households when the ECB finally starts to hike rates.
The caution comes as the latest figures from the Central Statistics Office show that property prices have risen by more than 70% in less than five years.