AIB predicts further increases in Irish house prices
Allied Irish Bank has predicted further increases in the price of houses in Ireland during the remainder of this year and said there was no evidence to support speculation of a property crash.
In a report on the housing market published today, AIB predicted that increased supply and falling demand would lead to a moderation in house price increases. It predicted that the rate of increase would slow to 7% by the end of this year.
It also said the market remained vulnerable to any withdrawal by investors due to lower rents, but said there was no evidence that investors were leaving the market at present.
The AIB also issued a positive outlook for the Irish economy today, saying growth rates should reach 3.5% this year and 4.3% in 2005. The bank said Ireland’s economic competitiveness had suffered in recent times, but the country remains well-placed to benefit from the ongoing global economic recovery.
It predicted that the jobs market would remain stable over the coming years, with employment expected to increase by 1.6% this year and by 1.8% in 2005.
The AIB also predicted that Ireland’s inflation rate would average 1.9% this year and 2.7% next year, with the increase in 2005 due to an expected rise in euro-zone interest rates.
