Irish property prices up nearly 11 pct in year to February

Irish residential property prices at a national level rose by 10.7 percent in the year to February, according to new official figures on Wednesday.

The figures from the Central Statistics Office (CSO) showed that in Dublin residential property prices increased by 8.3 percent in the year to February. Dublin house prices increased 8.1 percent whereas apartments rose 9.1 percent in the same period.

The CSO figures also showed that residential property prices outside Dublin were 13.2 percent higher in the year to February. House prices outside Dublin rose 13.1 percent over the period. Apartment prices outside Dublin increased 13.9 percent in the same period.

Overall, the national index is still 30.7 percent lower than its highest level in 2007. Dublin residential property prices are 31.3 percent lower than their February 2007 peak, while residential property prices outside Dublin are 35.7 percent lower than their May 2007 peak.

From the trough in early 2013, prices nationally have increased by 52.1 percent. In the same period, Dublin residential property prices rose by 67.9 percent, while residential property prices outside Dublin increased 47.9 percent from their lowest point.

Economists here say a lack of supply of houses has clearly pushed up prices, particularly in the Dublin area in the past few years.

"But it is not something that can be rectified overnight. Until this issue is addressed, prices in the capital and its outskirts will likely remain elevated, even with Brexit-related risks," said Alan McQuaid, chief economist with the Dublin-headquartered Merrion Stockbrokers.

The easing of mortgage lending restrictions imposed by the central bank combined with the tax-incentive scheme for first-time buyers announced in the October Budget will keep upward pressure on prices until new supply comes on the market, according to the Irish economist.

"We see house price growth remaining in positive territory on a year-on-year basis for a while yet, with the annual rate of increase now set in our view to be in the 7-12 percent range over the next few months," he said.