Population growth, immigration and prosperity will keep housing demand strong, according to the latest housing market study from Irish Intercontinental Bank (IIB) Homeloans network of mortgage brokers.
The survey also predicts house prices will remain high as interest rates stay low and as the release of SSIA funds from late next year has an impact on the market.
"Migration is boosting demand for housing in Ireland by far more than might have been expected," said Tom Foley, chief executive of IIB Homeloans. "It also seems that maturing SSIAs will have a marked impact on the property market."
Mr Foley added that house price inflation had eased to a pace that was more likely to be sustainable. He also said that lending practices were more prudent in Ireland than in the United States.
Austin Hughes, chief economist of IIB Bank and author of the study, said that property purchasing intentions of Irish consumers remained strong.
However, he warned that population decline in eastern European countries warranted caution by Irish property investors abroad.
The study said that SSIAs would have a major impact on the property demand. "It appears that a significant number of SSIA holders view them as property savings accounts. The SSIAs will give many people the wherewithal to get on or to move up the property ladder. So, in terms of the SSIAs, property is uniquely positioned in that it will benefit from the general 'feel-good' factor in spending," said Mr Hughes.
A weak European economy would ensure that the European Central Bank delays any increase in interest rates until late next year, although low interest rates would not be the main reason for property market strength, according to Mr Hughes.
"The euro zone economy is finding it very difficult to get the type of traction that might threaten higher interest rates anytime soon," said Mr Hughes.
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