The US economic slowdown will not significantly impact the Irish property market, Pat Gunne, managing director of Insignia Richard Ellis Gunne, said at a recent property conference.

"The fundamentals in every sector of the property market remain sound, and strong domestic demand will ensure that the market will continue to thrive in 2001. The 12.5 per cent rate of corporation tax will ensure foreign investment will continue. Our labour shortage and infrastructural deficiencies are of more concern than a slowdown in the US economy."

Eunan O'Carroll of Gunnes stressed that "fears of market collapse are unfounded, considering the unique demographic and economic fundamentals that prevail in this country".

He predicted that the average new house in Dublin will sell for £190,000 this year and the national average would be £140,000, while corresponding figures for second-hand houses in Dublin are £230,000 and £160,000 nationwide.

"Gunne Research estimates that house prices rose by an average of 18 per cent in 2000 and we predict a further increase of 15 per cent this year." As a result, stamp duty for first-time buyers "should be abolished completely", especially as "it is likely that less than 40,000 units will be completed in 2001".

Mr O'Carroll also said there is a severe mismatch between supply and demand in the rental sector, and "it is regrettable that the recent changes in relation to stamp duty will do little to ease the situation".

Noel Smyth of Dunloe Ewart also addressed fears about a property collapse. He said: "I believe at this stage in our development as a country that we lack self-confidence. We are introspective and waiting for the so-called `bump'. And, with everybody waiting for the `bump', the financial institutions are now placing severe restrictions on the property development industry in Ireland."

With the banks tightening up on lending, and a lack of public interest in investing in property here, Dunloe Ewart is now faced with a situation "where we will have to focus on fewer developments and scale back the vision we had for the company".

Although "supremely confident" about the property market here, Mr Smyth envisages greater segmentation in the product available to investors with "a consequent effect on returns".

Mr Smyth attacked the "step in, step out" approach to property legislation, such as the recent dropping of the 60 per cent capital gains tax threat on development property. "Changing legislation and short-term thinking is adding further confusion and uncertainty to a market where long-term planning is absolutely essential," he said.

He also attacked caps on the size of retail development as "anti-competitive practices in full force" and noted that Minister Dempsey's "failure to recognise the necessity to attract investors into the residential market by allowing interest relief will mean that substantial funding for this area will lie fallow for some time to come".