28th Jan 2015 13:34
DUBLIN (Alliance News) - Ireland's residential property prices growth accelerated slightly in December, figures from the Central Statistical Office showed Wednesday.
The residential property price index surged 16.3% year-on-year in December, following a 16.2% growth in November. In October, prices climbed 16.3%.
On a monthly basis, dwelling property prices rose at slower pace by 0.4% in December, after a 0.5% rise in the prior month.
Prices have been rising since April and the latest rate of growth was the weakest so far.
In the capital region Dublin, residential property prices increased 0.2% in December from the previous month and jumped 22.3% from the previous year.
Yesterday, the central bank announced relaxed regulations for first-time buyers, which it said was a precautionary measure against any emerging property bubble.
Under the new rules, first-time buyers will be allowed to borrow up to 90% of the property value to a maximum EUR 220,000, while others will be provided only 80%.
For loans exceeding EUR 220,000, first-time buyers will have to provide a 20% deposit for the amount in excess.
Speaking at new conference on Wednesday, Central Bank Governor Patrick Honohan said the rules would be tightened further, if needed. He pointed out that there was a housing problem in Dublin.
"A lack of supply of houses is clearly pushing up prices, particularly in the Dublin area, but it is not something that can be rectified overnight," Merrion Stockbrokers economist Alan McQuaid said.
"However, the latest planning permissions data showed a sharp rise in the third quarter, indicating that things may be starting to improve on this front, which should help to reduce the increase in house prices over time. The new lending restrictions imposed by the Central Bank are also likely to weigh negatively on buyers and help to push down house price growth in 2015."
The price of residential properties in the rest of Ireland rose 0.7% monthly in December, slower than November's 1.2% hike. Year-on-year, prices climbed by 10.2%.
Copyright RTT News/dpa-AFX