Underlying the stiff competition in the Irish housing market over the summer, a new analysis has revealed that nearly 40 per cent of houses were bought for at least 10 per cent over the original asking price.
According to the economic analysis by Bank of Ireland, the average mortgage approval for house purchases reached €318,300 in July, representing a 6.2 per cent jump compared to the same month last year.
Bank of Ireland has revised its forecast for residential property price inflation to 7.75 per cent for the year and predicts further price hikes next year.
A key driver of this surge is the country’s robust labour market, where earnings grew by 5.6 per cent in the year to second quarter, fueling increased purchasing power.
Additionally, the Central Bank’s relaxation of loan-to-income ratio regulations has led to higher leverage among first-time buyers. Mortgage debt among this group rose throughout 2023 and is expected to have continued into 2024.
The report estimates that Ireland’s current housing stock stands at around 2.18 million, translating to 405 homes per 1,000 people, the lowest ratio among European countries tracked by Euroconstruct, an independent forecasting network.