There is scope for significant property price growth in Ireland despite recent gains, according to a new report.
A study by the European Commission found that home prices in Ireland were undervalued by as much as 15% last year, and despite recent price growth, the report suggests that there is room for property prices to increase further.
The latest figures from the Central Statistics Office show the annual rate of residential property price inflation has picked in recent months, and is now running at the fastest pace in 15 months, at 7.3%.
Austin Hughes, economist with KBC Bank, told the press that while Irish house prices have increased in recent months, property prices in Ireland were still recovering, but appeared to remain undervalued, with plenty of room for further growth.
“If the current pace of price increase is sustained to the end of this year, this would correct about half of the undervaluation estimated in the commission report. In turn, this would suggest that, in the absence of notably adverse shocks to the Irish economy in 2017, Irish house prices could see further solid gains,” he said.